reverse mortgages California.">Many senior citizens and lenders new to the reverse mortgage business have been looking for solid answers on what reverse mortgage counseling is all about. Reverse mortgage counseling with a certified counselor is a requirement for all applicants, those in California and elsewhere. Reverse mortgage counseling used to be free, but since congress underfunded the program this year, borrowers must pay between $75 and $125 for the session. Unlike the past, when seniors were required to attend an appointment in person at their local consumer credit counseling agency, now most reverse mortgage counseling appointments are conducted over the phone - often with a counselor in another state.
Certification for these counseling agencies is provided by The US Department of Housing and Urban Development and the Federal Housing Authority and authorizes them to counsel on the Home Equity Conversion Mortgage (HECM). Your counselor may also discuss with you any one of the proprietary reverse mortgage programs.
Some of the information that your reverse mortgage counselor will provide is listed here: reverse mortgage effects on taxes, public benefits, their estate and heirs; financial implications of a reverse mortgage including the addition of interest to the principal balance; borrower responsibilities; reverse mortgage interest rates, fees and costs; borrower eligibility and calculation of the loan amount; loan repayment; and owner occupancy requirements.
The idea of undergoing reverse mortgage counseling is intimidating for some seniors. There is sometimes a fear that the counseling is a test they might not pass. On the contrary, the counseling is really a safeguard for them and another form of mandatory disclosure of loan terms for the California reverse mortgage. The senior cannot "fail." There is only one potential risk. That is, if the counselor has a strong reason to believe that the senior is legally incompetent or somehow unresponsive and thus perhaps unable to understand the terms of a reverse mortgage.
All states require reverse mortgage counseling for the HECM, however not all states require it for every type of reverse mortgage. In California, a senior homeowner is required to complete counseling prior to committing themselves to a reverse mortgage.
Reverse mortgage counseling is an excellent form of accountability for lenders, to make sure reverse mortgages are only provided to the right applicants. It is important for seniors to make an informed decision and to recognize that a reverse mortgage is not "free money," but a real loan on their house. Speaking with an informed and independent third party can offer comfort to some seniors who may be unsure about doing reverse mortgages California.
Luke Helm is an expert on reverse mortgages. He recommends Reverse-Mortgage-Info.net for more information on reverse mortgages California.
