While HUD and NRMLA made it clear that agencies cannot prioritize counseling based on funding, the backlash on this will not force agencies to make a decision: reallocate these counselor to task that generate revenue for them to stay open or provide a service that that they will receive no compensation for. They will then need to layoff staff, and the end result is that ALL request will take weeks if not longer to complete. What will happen now? HUD doesn’t have the funds to pay for counseling; Agencies need to be funded; there is a mortgagee letter that could help relieve the situation.

Thanks for this blog I like getting the broker view, but I think you’ve missed the big picture on counseling and its going to hurt your bottom line.

HUD has NEVER funded counseling properly and lenders have funded counseling agencies for years.. (well at least some .. thanks!) NRMLA suggesting that lenders can stop and just demand counseling as soon as it is requested is silly. Request away, if no-ones paying for counseling see what happens. It happened back in 2005 and wait times were 8-10 weeks… and as demand is probably double now.

Chuck is right. HUD can direct agencies not to give quicker appointments to clients of lenders who pay, but they have no power to say how much counseling agencies will actually do.

All the HUD money is gone. Counselors cannot charge clients, so how much counseling do you think will get done with no-one paying the agencies?

All the counselors I have talked with are cutting back.. Watch what MMI does, they do thousands each month, if they cut back wait times will go through the roof.

It’ll be fair but wait times are going to be long. HUD must know this but it looks like their hands are tied.. and brokers/direct lenders and their clients will have more to worry about than a donation to a counseling agency.

So if in 2 months you are all yelling because your clients cannot get counseled, you’ll all know that it was NRMLA and HUD that made this happen… in the interests of fairness.