You can't flunk reverse mortgage counseling.
Whew! The pressure is off but you still want to have a total understanding of the senior home loan called a reverse mortgage.
FHA requires that all applicants on a Reverse Mortgage have HUD counseling either over the phone or in person. Nearly all of my clients get the required counseling while sitting in the comfort of their own homes. Either way, grab a cup of coffee or tea and relax; you can't flunk.
You select a counseling agency and request an appointment. An appointment will be set at your convenience and pricing varies from $50 to $150. (Free counseling only occurs occasionally when a particular agency has received a grant.) You must pay for the counseling with a credit or debit card.
Both homeowners must "attend" the session which lasts anywhere from 45 minutes to over an hour depending upon your questions and your level of understanding. The counselor will offer to send you key information prior to the counseling session, however, a good reverse mortgage specialist will have already given it to you and all you have to say is "I have the papers in front of me".
During the session, your counselor will ask about your interest in a reverse mortgage, your circumstances and your needs. The counselor will provide information essential to your further understanding and discuss the various types of loans. You may ask the counselor questions and you will be asked questions such as:
1. When does the loan have to be paid back?
2. What happens to your home if you decide to move?
3. What responsibilites do you have regarding taxes, insurance and upkeep?
4. Who has title to your home?
5. Which loan program are you choosing and why?
A Counseling Certificate will be mailed to you and you can request a copy be sent to your Reverse Mortgage Specialist. (This is a good idea because it expedites the process.) Once the counseling is completed and the application is signed, an FHA case number is assigned to your file.
Be sure that your home is THE place you wish to stay for many years. Costs amortized over many years pencil out a lot better than costs incurred for a short-term loan. In the event your current home is not the home you want to stay in, you have another option. Did you know you can purchase a home with a reverse mortgage? Some real estate agents are not up to speed on the details (their expertise is the purchase and sale of homes) so get the details from a knowledgable and reliable source.
Guidelines for home loans change all the time. Reverse Mortgages (HECM's) are no exception. A financial assessment is coming soon which may limit eligibility so it is wise to speak to a reverse mortgage professional sooner rather than later.
You can't flunk Reverse Mortgage Counseling. Hooray!