November 2019

Reverse Loans Are Confusing

Generally, in spite of the articles and television commercials about reverse loans, I have found that many people are still quite confused about reverse mortgages and do not understand that they are just like a regular home loan, with the exception there are no mortgage payments to be made by the borrower.

And what I find very surprising is how many professionals, such as traditional Loan Officers, Bankers, CPA’s, Estate Planning attornies and Financial Advisors are very uninformed, and are not qualified to provide their clients with accurate information if their client asks them about it.

This is unfortunate because quite often seniors are relying on them for professional advice and sometimes the professional simply gets it “wrong” and ends up possibly giving them very bad advice.

For a senior who is attempting to learn about the loan and whether or not it should be considered as a possible source of additional funds, it leaves them without too many reliable sources of correct information.  I quite often suggest that they utilize the counseling that is provided by HUD-approved Counseling agencies throughout the country and sometimes it can be done in person.

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Part of my consulting service provides them with several National agencies and 10 that are within California.   They can call any one of them and set up a counseling appointment that can be done over the telephone and learn about reverse loans.

The Counselor provides accurate information and answers the individual’s questions or concerns about them.   At the end of the session, the Counselor will mail a HUD Counseling Certificate that is viable for 6 months.

If the seniors decide to apply for a reverse mortgage, they will give a copy of the Certificate to the Loan Officer to verify that they have been counseled.   This is a HUD regulation and provides a layer of safety for seniors and no one can apply for the loan without having received the counseling.

Speaking with a HUD-approved counselor is a great resource to get questions answered and not end up having a salesperson from a Lender calling them constantly and pressuring them to apply for the loan.

In closing, if anyone who is reading this and would like to have a copy of the Counseling list, just send me an email requesting it and I will provide it to you.

And I will not pester you to apply for the loan.



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