Reverse Mortgage Counseling Services

Understanding Reverse Mortgages

A reverse mortgage is a type of loan that allows homeowners 62 and older to convert part of the equity in their homes into tax-free income, without making payments. When the homeowner/borrower permanently moves out, sells their home, or passes away, the reverse mortgage comes due and must be paid in full. It can provide flexibility for senior homeowners who need additional funds for retirement, but it’s a complicated and sometimes risky financial tool, which is why lenders require you to work with a qualified expert to make sure you fully understand the terms of your reverse mortgage.

The most common type of reverse mortgage is as a Home Equity Conversion Mortgage (HECM). HECM’s are government-sponsored reverse mortgages, insured by the FHA, and require counseling before you can take out the loan.

What is reverse mortgage counseling?

Reverse mortgage counseling is an opportunity to work one-on-one with a HUD-certified reverse mortgage counselor to review all the potential risks and benefits of a reverse mortgage and ensure you’re making an informed decision. During your reverse mortgage counseling sessions, your counselor will work with you to help explain how HECMs work, the financial and tax implications, payment options, and costs associated with a reverse mortgage.

Do I need reverse mortgage counseling?

Every HECM loan comes with the requirement that the borrower complete a reverse mortgage counseling session. This is a requirement set by the U.S. Department of Housing and Urban Development (HUD) to ensure you fully understand what it means to use a HECM. Your lender will likely require you to obtain an HECM counseling certificate, which MMI is proud to offer upon completion of our sessions.

Reverse mortgage counseling can be beneficial to anyone trying to decide if a reverse mortgage is a good option, but it’s generally only recommended for homeowners who have already made that decision and need to fulfill the HECM counseling certificate requirement associated with their loan program. If you’re actively weighing options and not yet committed to using a reverse mortgage, consider starting with a free credit counseling session instead.

Reverse mortgage counseling is a two-part process designed to ensure that you fully understand your reverse mortgage, including the benefits and responsibilities.

Reverse mortgage counseling is a two-part process. It begins with a 30-minute session where a HUD-certified reverse mortgage counselor collects basic information about you and your finances. You'll then be provided with a packet that includes information on the costs and benefits.

HUD requires that you have ample time to read and consume this information, which is why the second half of your counseling must be scheduled separately.

During your second session you'll receive comprehensive, one-on-one education on the benefits and potential downfalls of using a reverse mortgage. This portion usually takes between an hour and 75 minutes. Once you're done, your HECM counseling certificate of completion will be available immediately and deliverable via email, fax, and mail.

Need more information before getting started? Here are some of the top reverse mortgage questions we get asked.

Is there a fee for reverse mortgage counseling?

There is a fee of $199 to complete reverse mortgage counseling and receive your required HECM counseling certification. That fee is collected at the beginning of your counseling.

Can a relative complete counseling on my behalf?

The borrower must be present during both required sessions, unless they have previously appointed someone to serve as their Attorney in Fact via a Power of Attorney. With the borrower’s permission, a family member or friend may attend the session with the borrower but may not speak on their behalf. All borrowers must be present and participate in the reverse mortgage discussion.

Does my spouse need counseling if they aren’t on the mortgage?

All persons on the deed must be counseled. In the case of an ineligible or underage spouse, both AARP and FHA recommend counseling. It's important that all parties involved understand the implications of a reverse mortgage and the risks of relinquishing (quitclaiming) their interest in the property.

How far in advance can I schedule my counseling?

HUD requires that reverse mortgage counseling sessions be scheduled no more than one week in advance. It's crucial that you keep your scheduled appointment, as finding a new availability can be tricky.

How soon will I receive my HECM counseling certificate?

Certificates are available immediately at the successful conclusion of your session. They can be distributed via email, fax, or standard mail.

More questions?

Check out our complete list of reverse mortgage counseling FAQs.

Get the information you need to make an informed decision about your home and receive the HECM counseling certificate required to close on your reverse mortgage.

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