Reverse Mortgage Counseling (Free, Online, In-Person)

December 7, 2019 By Michael G. Branson 26 comments

The U. S. Department of Housing and Urban Development (HUD) requires that homeowner(s) interested in pursuing a Home Equity Conversion Mortgage (HECM) receive mandatory reverse mortgage counseling regarding the implications of and alternatives to a reverse mortgage from a HUD-approved HECM counseling agency.

We are required by HUD regulations to provide you with a list of reverse mortgage counseling agencies.

The list must include all HUD-approved counseling intermediaries that can provide telephonic counseling, as well as five (5) counseling agencies within your local area, state or both, with at least one of the local agencies located within a reasonable driving distance for the purpose of face-to-face counseling.

Top Reverse Mortgage Counseling Agencies

Counseling Agency Next Appointment HECM Price JUMBO Price Phone Website

Cambridge Credit Counseling 24 Hrs. $125 $145 888-764-7460 Website

Smart Money Housing 24 Hrs. $125 $150 800-403-3807 Website

DebtHelper.com 24 Hrs. $145 $145 800-920-2262 Website

QuickCert, Inc. 72 Hrs. $125 $125 888-383-8885 Website

Hancock Community Development, Inc 24 Hrs. $130
$130 877-284-4326 Website

Hope Inc. 1 Week $175 N/A 888-776-0155 Website

Money Management International (MMI) 1 Week $175 $175 877-908-2227 Website

GreenPath Financial Wellness 2 Weeks $199 $199 888-860-4167 Website

Clearpoint Financial Solutions 2 Weeks $175 N/A 877-877-1995 Website

Counseling turn times are approximate and last updated 07/08/2020

Counseling Agency	Next Appointment	HECM Price	JUMBO Price	Phone	Website
Cambridge Credit Counseling	24 Hrs.	$125	$145	888-764-7460	Website
Smart Money Housing	24 Hrs.	$125	$150	800-403-3807	Website
DebtHelper.com	24 Hrs.	$145	$145	800-920-2262	Website
QuickCert, Inc.	72 Hrs.	$125	$125	888-383-8885	Website
Hancock Community Development, Inc	24 Hrs.	$130	$130	877-284-4326	Website
Hope Inc.	1 Week	$175	N/A	888-776-0155	Website
Money Management International (MMI)	1 Week	$175	$175	877-908-2227	Website
GreenPath Financial Wellness	2 Weeks	$199	$199	888-860-4167	Website
Clearpoint Financial Solutions	2 Weeks	$175	N/A	877-877-1995	Website

Steps to receiving your reverse mortgage counseling certificate

Request your pre-counseling document set (Includes loan comparison, closing cost worksheet, amortization schedule, TALC – total annual loan costs)
Have these mandatory documents available: HUD document titled “preparing for your counseling session” and NCOA booklet “use Your Home to Stay Home” (.PDF versions provided below)
Determine whether you wish to see a counselor in person or obtain counseling by phone
Call around and check counselor availability and pricing. Some counseling agencies only accept payment upfront while others allow you to put their fee into the reverse mortgage closing costs
After you have received your counseling you will receive three copies of your certificate in the mail and have the option to have your counselor fax or email a copy of the certificate to your lender

In-Person HECM Counseling Locator

Search our newest interactive map that locates HUD approved agencies nearby with in-person availability.

Preparing for your Counseling Session (PDF file, 4 Pages)
Use Your Home to Stay at Home™ (PDF file, 26 Pages)

Counseling for those with vested interest

Independent reverse mortgage counseling is required prior to closing for the borrower and co-borrower, who will have a vested interest at closing
Power of Attorney or Guardian/Conservator must be counseled on behalf of any borrower(s) or vested owner(s) that are legally incompetent.

Note: POA for convenience is not permitted at this time

CA and AZ – Counseling must be completed prior to application
TX – Counseling must be completed at least 5 days prior to closing. The TX counseling cert is good for 180 days.

Note: See state regulations for additional requirements and timing.

Top 5 FAQs

What is reverse mortgage counseling?

The counseling on a reverse mortgage is an independent session conducted by a third party. It is a requirement for all reverse mortgage loans. The purpose of the counseling is to ensure that all borrowers and spouses understand what a reverse mortgage is and their obligations when they have one.

How long is a reverse mortgage counseling certificate good for?

A reverse mortgage counseling certificate is valid for 180 days. For HECM loans in most states, the certificate must be current at case number assignment, but the loan can close if the certificate has expired. In some states like Texas for example, the certificate must be unexpired at time of closing or the borrower would have to complete another counseling session prior to loan closing.

Why is counseling a requirement to get a reverse mortgage?

A reverse mortgage loan is a complex financial instrument and therefore the counseling is required as a safeguard to the consumer. FHA and mortgage lenders need to be sure that all reverse mortgage applicants truly understand what a reverse mortgage is and their requirements as a homeowner obtaining a reverse mortgage.

Who is required to complete reverse mortgage counseling?

All borrowers on the loan as well as any non-borrowing spouses are required to be counseled. Additionally, any Remaindermen of a Life Estate or any other parties who hold title to the property who are not eligible borrowers must also be counseled for the reverse mortgage.

Are the heirs responsible for reverse mortgage debt?

There is no personal liability for the reverse mortgage loan to the borrower or their heirs. The sole collateral for the reverse mortgage loan is the property. If the property value is lower than the accrued loan balance on the reverse, the heir does not have to satisfy the balance of the reverse mortgage loan and can simply sign a deed-in-lieu of foreclosure to the lender and move on with no further obligations.

What happens after your counseling session?

After you have completed your counseling you will be mailed a certificate of completion (view sample certificate).

This Counseling certificate should be signed and returned to your lender if you wish to proceed with the processing of the loan.

No 3rd party services may be ordered such as Appraisal, Title, Escrow until the lender has your signed certificate in hand.

Additional Documents for CA Homeowners

CA Reverse Mortgage Worksheet Guide (PDF file, 2 Pages)
CA Important Notice to Reverse Mortgage Loan Applicant (PDF file, 1 Page)

Additional resources:

Post Tags: reverse mortgage counseling

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About the Author, Michael G. Branson

Michael G. Branson (CEO All Reverse Mortgage Inc. and moderator of ARLO™) has 40 years of experience in the mortgage banking industry and has devoted the past 15 years to reverse mortgages exclusively. Michael G. Branson was part of the team that introduced the first fixed-rate jumbo reverse mortgage to market, which was sold to a private investor in 2007.

26 Comments on this Article

I'm ARLO™ and I love responding to your questions and comments. Let's talk!

Jennifer Hawkins
July 15th, 2020

Is there any free counseling?
Reply to Jennifer
- ARLO™
  July 15th, 2020
  
  Hello Jennifer,
  Counseling that is free to the borrower exists when there is grant money available to pay for the counseling on the borrower's behalf. Lenders cannot direct you to any specific counselors, but you can certainly shop for the best deal for your circumstances.
  Just by doing a quick internet search, I was able to see several companies who state that they sometimes offer counseling free of charge to the borrower.
  The problem is that no one knows when a grant will be available or how long it will last before it is exhausted, and counselors need to wait for the next grant to be available.
  This is one of those things that will just require you to be vigilant and to look around until you find the agency or counselor who can best meet your needs.
  Some counselors might even be willing to wait to be paid when the loan closes although that is not as prevalent as it was in the past due to the fact that so many loans do not close for a myriad of reasons (many times not even because the borrower of the property do not qualify) and in each of those cases, the counselor would never be paid for their time and work if they were not paid at the time their services were rendered whether by the borrower or by the grant.
  Reply to ARLO
Jim A.
June 5th, 2020

Where can I find a job as a reverse mortgage counselor?
Reply to Jim
- ARLO™
  June 8th, 2020
  
  Good Morning,
  Reverse mortgage counseling companies are approved by HUD, but they are independently owned and operated. I would suggest that you contact them directly to ask them how you can secure a position with their company.
  HUD has a counselor locator available online on their website and I would suggest you check with a counseling agency in your area first. The HUD page can be found here: https://apps.hud.gov/offices/hsg/sfh/hcc/hcs.cfm.
  Reply to ARLO
Marshall K.
March 9th, 2020

How can I locate a Chinese speaking councilor for my wife?
Reply to Marshall
- ARLO™
  March 9th, 2020
  
  Hello Marshall,
  
  You can find counselors that are approved by HUD and can offer the counseling in different languages by using the HUD website. Firstly, you click on this link:
  
  https://apps.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?weblistaction=summary
  
  A state map will come up and you can click on the map or on the state of your choice in the upper left hand corner.
  
  After you click on the state of your choice, next you will have to go to the bottom of the page and narrow your search. There are many choices you can use to narrow your search including specific cities, zip codes and others (shown below) but since not all services and languages are offered in all states, we suggest you narrow down just to the state level and your specific need. In this case, I used Reverse Mortgage Counseling and Chinese Mandarin as my search parameters in the state of CA and the search narrowed down to just one agency in the entire state.
  
  If your request is not shown, you may have to check other states as well. Remember though, you can complete the counseling on the phone in almost all cases so it is not imperative that the counselor be located nearby. Remember that in some cases, a counselor in just over the state line another state may be closer than one located in the same state but at the other end of the state.
  Reply to ARLO
Boehler V.
March 3rd, 2020

My father has a reverse mortgage and wants to refinance. He lives in Washington and wants to see the waiver in order to not do the counseling again. He did the counseling in 2018.
Reply to Boehler
- ARLO™
  March 3rd, 2020
  
  Good Morning,
  
  Most companies will require your father to counsel again at this time. HUD does not always require counseling if the borrower has attended in the last 5 years, but many of the states do. HUD does require additional counseling if your dad meets certain thresholds though.
  Unfortunately, the lender may not know if dad will hit the required thresholds until the lender proceeds and has ordered and received the appraisal.
  Then the problem is that if they proceeded without the new counseling, the loan application would need to be cancelled and the lender would need to start all over with a new application and a new appraisal because HUD does not allow lenders to order any services on loans that require counseling until after that counseling has been completed.
  Lenders typically will not allow borrowers or themselves to take that chance just to avoid counseling since the risk is greater than the reward, even if the state does not have laws to restrict it.
  Reply to ARLO
William C.
February 19th, 2020

How long after Counseling does it take to get the certificate?
Reply to William
- ARLO™
  February 19th, 2020
  
  Hello William,
  
  It really depends on the counselor. Most will want to send it to you in the mail and so you will have to wait an extra week or more in that case. However, if you ask them to send it to you in your email or to your lender in their email, most counseling companies will do so and you will have the certificate same day in many instances. If you or the lender have a good printer, you should be able to print an original that you can sign in original ink and there will be no delays.
  Reply to ARLO
Eric B.
January 30th, 2020

Which states allow you to waive the HECM refinance counseling if all requirements are made?
Reply to Eric
- ARLO™
  January 30th, 2020
  
  Hello Eric,
  
  Rather than looking up all state laws to post which states have more specific counseling requirements, I would rather answer you with the industry response.
  HUD has not changed their counseling requirements which would allow a borrower to waive counseling if they had previously taken counseling and were refinancing that loan within 5 years and met certain requirements.
  However, some states have as well as lenders, investors and industry agencies like the National Reverse Mortgage Lenders Association (NRMLA) which all seek to improve the security for borrowers have changed the counseling requirements. HUD sets the minimum that is required in all cases but also encourages lenders to always seek to protect the program and the borrowers.
  So although some states still allow lenders to follow the HUD guidelines that have not changed, most lenders and investors (investors are those who buy the loans in the secondary market) follow the NRMLA industry standards set to protect senior homeowners from those who would engage in equity stripping through constant refinancing.
  To this end, counseling is generally required by most lenders on every transaction at this time, whether the state requires it or not to be sure all borrowers are fully aware of the program changes.
  
  Furthermore, on a refinance transaction, there are several "tests" that the borrower must meet in order to be eligible for the loan. You must be able to receive at least 5 times the cost of the loan in new benefits and at least 10% in additional principal limit to meet the eligibility restrictions that NRMLA imposes on lender members to maintain an ethical standard and not be engaging in refinance churning.
  In addition, the loan must have been closed at least 18 months prior to the application for refinance. The changes became effective as a result of some originators zeal to push borrowers to refinance for relatively small rewards and soon after their past loans closed.
  
  So the bottom line is that you really would be required to have counseling for a refinance again in all instances unless you were located in a state that did not require it and you were able to find a lender that did not adhere to the NRMLA code of conduct for ethical lenders. I am afraid I could not tell you who might do that in your state.
  All Reverse Mortgage is a NRMLA member and as such, we do adhere to their professional, ethical standards.
  Reply to ARLO
Rebecca M.
October 6th, 2019

Do we need to complete the counseling before we apply?
Reply to Rebecca
- ARLO™
  October 6th, 2019
  
  Hi Rebecca,
  
  You do not need to complete counseling before filling out a request for application or even the application, but some states (like California) will not allow us to do anything else until after the counseling is done and in all states we cannot order any services on the loan processing until after you have completed counseling so the loan will not be moving forward until after you complete the counseling.
  Reply to ARLO
Pat walker
August 26th, 2019

I'm still not clear on how the interest is applied to the HECM. Unlike a standard mortgage you pay monthly and the mortgage payment covers everything and the loan goes down monthly at a fixed interest rate With hemc you don't pay monthly so the interest is attached to the loan annually and can increase correct.
Reply to Pat
- ARLO™
  September 4th, 2019
  
  Hi Pat,
  Neither loan accrues interest "annually". The interest is calculated and reported on a monthly basis. Reverse mortgage borrowers are never required to pay a monthly payment, but they can elect to at any time in any amount up to and including payment in full.
  For example. if the interest that accrued in a single month was $500 and no payment was made, the balance would increase by this amount and then the interest would accrue the next month at the higher balance. If you made a payment of $700, your interest would accrue the next month on a lower balance because your payment covered the interest that accrued and then paid down a portion of the outstanding balance.
  So, it really acts just the way any other loan would. If you don't make a payment which covers the interest that accrued that month, negative amortization occurs, and your balance rises. If you do make a payment that covers or exceeds the interest that accrued, the balance will stay the same or go down.
  The difference is that with a reverse mortgage, you never HAVE to make that monthly payment so it's completely up to you. Each month you will receive a statement from the loan servicer, so you always know where you stand and if you do decide to make payments or repay the loan early, there is never a prepayment penalty.
  Reply to ARLO
Joachim
May 29th, 2019

Hi, my sister took the counseling just a couple months ago & passed. However she has become incapacitated since then. Can her POA retake the counseling (on her behalf) at this time even though it has not been 120 days since? I'm aware that the name on the Counseling Certification must have the name of the loan signer on the document as well as the home owners name
Reply to Joachim
- ARLO™
  May 29th, 2019
  
  Hello Joachim,
  
  The POA would have to retake the counseling as well as complete a new application. The lender would have to keep the old information as well if you have started the loan already to show that they did not start the loan before the initial counseling, etc. had been performed but this can be done.
  The POA would have to have been dated prior to the date of your sister's incapacitation for it to be valid and the lender will have to get Dr's notes to verify that your sister was able to grant power of attorney at the time the POA was signed but that is a normal HUD requirement any time a POA is used.
  Reply to ARLO
Mary Ziegenhagen
May 13th, 2019

Why are there no HUD reverse mortgage counselors north of San Francisco?
Reply to Mary
- ARLO™
  May 13th, 2019
  
  Hello Mary,
  Great question, I wish I had an equally great answer! The simple truth however is that reverse mortgage counselors are independent companies/individuals, approved by HUD.
  It's up to individuals and companies to apply for approval and continue to be certified and at this time, I see only 14 companies throughout all of CA on the HUD approved list.
  I do see that there is at least one just over the order in Medford, OR if that is closer for you. Unfortunately, states like Nevada have only one approved counselor in the entire state.
  And don't forget, counseling can also be done on the phone as well. You do not have to drive to the office of the counselor. This works well for many who are not within proximity to a counselor's office.
  Reply to ARLO
Patrick D.
May 1st, 2019

How much does the counseling cost for the Hecm Loan?
Reply to Patrick
- ARLO™
  May 1st, 2019
  
  Hello Patrick,
  
  Each company sets their own fees and the fees generally run from $99 to $159. There are times when some companies receive government grants though and when they have grant money available, they can offer the counseling free to the borrowers.
  We are not allowed by HUD rules to direct a borrower to any specific counselor and never really know who has the grant money available as it is usually only available for a short while until the funds are depleted but I always advise borrowers to shop around for a counselor who is able to meet your scheduling requirements and for the best price if the cost is a concern.
  Any counselor can provide the counseling via the phone if it is allowed in your area (most states do allow it) and unless your preference is to be counseled in person, you can talk to a counselor on a toll-free number anywhere in the US and achieve the same results.
  Often, due to time changes, you might even find someone more willing to work in your preferred timeframe if you are an early riser or prefer a later appointment if you just go to a different time zone.
  Reply to ARLO
Marvin Z.
April 8th, 2019

Can you recommend a counselor for a HECM reverse mortgage near Landenberg, PA 19350?
Reply to Marvin
- ARLO™
  April 8th, 2019
  
  Hi Marvin,
  
  You can search our website above for a local counseling agency and you can sort by city, zip code or state. We recommend that you start with the state because there may not be any counselors available in your city or zip code.
  
  If I put in the state of PA, there are 7 agencies statewide that are on HUD's list that appear below. Not knowing where you are in the state though, there may be a closer agency just over a state line that may also work better for you. For example, PA is surrounded by 6 other states and you may be closer to a counselor in another state if you are located near the state line and so are, they.
  
  Remember, you can also complete your counseling on the phone if you prefer and in that case, all the calls are toll-free and it really doesn't matter where the counselor is located throughout the United States and so you should just find a counselor who can best accommodate your schedule and needs.
  Reply to ARLO
Bonnie Derrick
December 1st, 2018

Can I get counseling and apply for HECM purchase loan before deciding on a home or state. We are looking in CA, NV and AZ. We had a HECM loan in the past which we paid off after an inheritance. This would not happen this time. Looking at max $300k purchase.
Reply to Bonnie
- ARLO™
  December 3rd, 2018
  
  Hi Bonnie,
  
  You can get counseling and tell the counselor it is for a future purchase of a "TBD" (to be determined) address. They will update the counseling certificate later to reflect the address on which you decided once known. You must remember that the certificate is only good for 6 months so if you choose a new construction home and the entire process takes longer than that to complete the home and be ready to close, you may have to repeat the counseling later.
  
  You can't apply for the loan though because you don't have an address and therefore, the lender cannot obtain a HUD Case number. We work with borrowers quite often who are still looking for a home and have not settled on a property and you can get some things ready including having your information reviewed so that when the time comes, you are ready to move quickly. In that case, you might only have to update some of the information you supplied but all questions or possible issues with credit or income will have been determined and resolved well in advance.
  Reply to ARLO

Counseling Information by ARLO™

Did You Know?

Your Home's Value

Age Matters

Your ARLO™ Analysis

Reverse Mortgage Counseling (Free, Online, In-Person)

Top Reverse Mortgage Counseling Agencies

Steps to receiving your reverse mortgage counseling certificate

In-Person HECM Counseling Locator

Counseling for those with vested interest

Top 5 FAQs

What happens after your counseling session?

Additional Documents for CA Homeowners

There's a New Reverse Mortgage on the Block... Meet ARLO™

Or Talk to our Human Experts! Toll Free 800-565-1722

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About the Author, Michael G. Branson

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