In the sincere desire to protect seniors from predatory lending, a new Bill has been proposed in Sacramento that will require seniors to meet personally at the office of a HUD approved agency to complete their counseling, prior to applying for the federally regulated Reverse loan.
HUD requires seniors who are applying for a Reverse loan to complete counseling through an approved counseling agency in order to determine if the federal loan program is a viable solution and if it will provide them benefit in lieu of selling their home. The process is done over the telephone and takes approximately one hour to complete as the counselor proceeds through a uniform procedure, answering the client’s questions and determining whether or not they may qualify for other government programs.
AB 2010 is a new Bill that has been introduced in Sacramento that would mandate face-to-face counseling on all senior reverse mortgage loan applicants without exception or regard to a senior’s particular situation. This will create an unnecessary hardship, as many are unable to drive to appointments and will end up creating delays and additional hardship for a senior and most likely, the cost of the counseling fee will increase as well.
The “intent” of this Bill is sincere, as it’s looking out for the “seniors” but is a redundancy in the extreme. There are already a multitude of laws and disclosures in place to protect them from financial abuse and this will only create a burden and another hurdle for them to over come.
Just my 2 Cents. I hope it does not get passed.