For a limited time, The National Council on Aging (NCOA) will offer special, reduced counseling fees through September 30, 2013. Reverse mortgage counseling is required before borrowers can take out a Home Equity Conversion Mortgage (HECM) reverse mortgage loan and offers borrowers the opportunity to speak with unbiased professionals who will also check into other available options for improving their financial situation. For this limited time, counseling fees are only $90, down from the original $125 through NCOA.
The National Council on Aging is a nonprofit service and advocacy organization that has been providing viable public resources to seniors to help them maintain a healthy, active role in their communities. Amy Ford, Director of NCOA’s Reverse Mortgage Counseling Services Network states that: “Reverse mortgages can be a lifeline for older homeowners who wish to meet their financial needs, but there are costs involved. Getting objective counseling about available options, and gaining a better understanding of these products, is vital to ensuring consumer protection.”
Reverse mortgage loans can be a helpful financial option for seniors aged 62 and older who have sufficient equity in their homes and live in the home as their primary residence. Seniors can use a reverse mortgage to turn a portion of their home equity into cash, either through monthly payments, in a lump sum or a line of credit. The amount that can be borrowed depends upon the age of the youngest borrower, the current interest rate, and the lesser of appraised value of the home, sale price or maximum lending limit. Seniors who obtain a reverse mortgage can use the funds to pay off medical bills, travel, make upgrades to their home, or whatever they wish.
Additionally, the home must meet a few specific requirements to be eligible. The home must either be a single family home, a two to four unit property with the owner living in one unit, a Department of Housing and Urban Development (HUD)-approved condominium or a manufactured home that meets Federal Housing Administration (FHA) requirements.
The U.S. Department of Housing and Urban Development has approved nine nationwide organizations to provide reverse mortgage counseling either face-to-face or over the phone. Anyone who seeks a HECM reverse mortgage must obtain counseling from a HUD-approved counseling agency. NCOA may also allow seniors facing foreclosure or bankruptcy, or whose monthly income is less than $1,000 per month, to have this fee waived. Seniors whose annual household income is less than 200 percent of the Federal Poverty Level may qualify to pay a reduced fee or to have the fee waived all together.
Reverse mortgage counseling is an important tool for seniors who are deciding if a reverse mortgage is a good fit for their financial needs. During the session, the counselor will discuss the borrower’s current financial situation and future goals and the process of obtaining a reverse mortgage loan. The counselor will also discuss public and private benefits programs that may be useful in helping make ends meet as well as programs that may help seniors remain independent in their homes longer. Seniors are encouraged to ask any questions during the session and to bring along a trusted family member or financial adviser for support.
Having an unbiased professional discuss all aspects of the reverse mortgage loan process with the borrower and provide alternative options through other available programs can help the borrower decide which option is best for their needs and lifestyle. For more information about reverse mortgage loans please call 866-751-6105. To learn more about NCOA’s approved Reverse Mortgage Counseling Network, call 800-510-0301.