Here we disagree. Certificates are currently being issued. The checklist is brand new.

If you are correct then what does CCC Section 1923.5(b)(2) mean when it says: “The checklist required in paragraph (1) shall be signed by the agency counselor, if the counseling is done in person, ….”

I am truly astonished by your reply. I would remind you as Mr. Peter Bell does vigorously and rigorously that representatives of HUD, Congress, and other agencies read RMD comments. Please note the involvement of Mr. Prescott Cole, legal counsel for an elder advocate group.

I was involved with the replacement of the required disclosure with the California state Senate, starting in late 2007, denouncing the use of the term “additional income” in referring to mortgage proceeds as both misleading and deceitful. AB 329 did not change the required disclosure; that was accomplished by amendment to satisfy a California Senate requirement to drop a competing bill, California Senate Bill 660.

In your reply you refer to regulations. I would overlook that except you discuss the regulator. I must plead ignorance; I know of no regulations or any regulator who has issued any regulations on California Assembly Bill 329 that will go into effect on January 1, 2010. If you have that information, please present it. I am afraid you are both greatly misinformed and worse, misinforming.

California Civil Code Section 1923.5(a) tells consumers in its mandated disclosure that counseling is required. CCC § 1923.5(b)(1) states that the consumer should discuss the items presented in the checklist with the counselor. You state that places no implied or legislatively expected obligation on the counselor whatsoever.

As a counselor, what is the consumer paying for? Most counseling in the past took 30 minutes or less. This has been reasonably verified by the GAO. That is a fee of $250 and more per hour. And yet if the law states that the consumer should discuss the items, the counselor is not obligated to do it? That is a pretty steep rate for that level of consumer protection.

You knowingly quote CCC § 1923.5(b)(1)(B) in your reply above. I point you to CCC § 19235.5(b)(1)(F) as well. To a simple CPA and I believe most consumers, these require detailed responses. You state that a counselor is under no obligation to address them at all.

I do not even agree with the obligation you believe is on a counselor. The counselor must only sign the checklist IF the counseling was done in person, i.e., face-to-face.

Now going back to the question you claim Ms. Minkoff asked. If that was the question she actually asked, then you would have seen a harsh response. She and I speak by phone and correspond by email regularly. I will ask her if your question was ever asked and get back to you with that response and some additional comments.

I would be worried about counseling if you were the only counselor I speak with. Fortunately the counselors I speak with see their responsibilities in a slightly different light.

Thank you for being the first proponent of the bill to actually talk about some detail. As you are clearly familiar with the bill can you help me out with a broader understanding of what is meant by discussion of:

“The prospective borrower’s ability to finance routine or catastrophic
home repairs, especially if maintenance is a factor that may determine when
the mortgage becomes payable.”

Are the key points here that having tapped the equity in their home for a HECM it will be more difficult to obtain additional home equity financing and that borrowers should consider this in choosing how to use their proceeds.

On the face of it the discussion seems pretty simple.. less equity, less future borrowing ability.. but I'd appreciate your thoughts on what the bills authors were trying to get at.

I think that your response to quotes Mr. Erickson and Mr Keene is overly harsh. Asked a question about whether they will comply with California law, what are they supposed to say?? No??? and decrying regulations that will go into force in several weeks would not be a smart move….Can you imagine any lender giving a quote to a reporter saying they are going to struggle implementing the new RESPA regs?

Counseling agencies are placed in a difficult spot in responding to pretty open ended “requirements”. As I see it they have a choice a) try to comply with what they think the rules mean or b) don't counsel in California. If they choose to continue its not surprising their public statements will be of confidence in their ability to comply.

The requirement set out in AB329 IS easy to meet in certain areas and less so in others. Your concern and criticism seems to be based on an assumption that I don't think is 100% correct.

The language in the bill is as follows:

“The written checklist shall conspicuously alert the prospective borrower, in 12-point type or larger, that he or she should discuss with the agency counselor the following issues:” and goes on to list a lot of points for discussion.

The bill did not dictate the nature of these discussions, but you appear to have decided on what they should be when you write:

“This requires that the counselor not just present the idea that options are available to seniors and what some of the more important of them are but rather requires them to discuss the extent to which all options apply”

Where in the legislation are counselors required to do this? All I saw is a requirement to provide and sign a checklist to a consumer of questions to ask the counselor.

Admittedly only a foolish counseling agency would be unprepared to address these issues to some extent (most subjects ARE covered to some extent in a HUD compliant session today anyway), but there is no regulation describing how detailed these reply should be.

From a counseling standpoint it would be great to understand what level of detail required in addressing “The extent to which the prospective borrower’s financial needs would be better met by options other than a reverse mortgage”…… or impact on tax situation., government benefits and so on but of course this kind of detailed guidance is nowhere to be seen.

Should the regulator actually define the expectations of the counseling response to these broad issues, counselors will do their best to fully comply.

I apologize in advance if I have missed detailed guidance on exactly what the devil of the details are… but without that information I believe you are imposing your own opinion of exactly what the content of a counseling session should be.