Inside Look: Lender Conditions from the Consumer Perspective

NewImage.jpgOver at Time Goes By, Ronni Bennett continues to document her reverse mortgage experience with her latest article about lenders closing conditions.

Her series of articles has provided interesting insight into the reverse mortgage process and what consumers are thinking.

While Bennett has been approved for the loan, she still has conditions from the lender she need to meet, no surprise there.  “A couple that are, to me, arbitrarily niggling; others are just how banks spend their time; and one that is flat out unreasonable,” she writes.

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Just a few of the conditions she needs to clear are:

  • Certified closing statement from the sale of my Maine property. In other words, they want to know where I got the money to buy my new home. My copy won’t do; it must be sent from the title company.
  • Certified closing statement from the purchase of my Oregon property. I have no quibble with this one.
  • Proof of residence in the Oregon apartment. I assume this means they suspect I’m lying about living here. They wanted the three most recent utility bills: fine.

Reverse Mortgage Part 7: Lender Conditions

 

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  • Ronni,rnrnAs usual your candor is welcome and appreciated.rnrnI agree with your points about providing a copy of your investment account. Identity theft is rife and too often overlooked as a reason NOT to supply information to a lender.rnrnFor a loan which supposedly has no credit requirements, it seems ridiculous that the new counseling requirements mandate a complete picture of the finances of a senior as of the date of counseling. Ronni, I hope some at HUD will read your comment about providing too much financial data. Personally I believe there are far more seniors with the same attitude than those at HUD ever want to acknowledge. rnrnIn a matter of months I will join the ranks of those over 62. Reading your online publication and your authors, somehow I do not believe I will suddenly become quite as mentally feeble as some would describe us.rnrnThank you for your detailed articles. They are very helpful. Keep up the good work.rn

  • The Financial Interview Tool (FIT) and the Benefits Check Up (BCU) questionnaire are designed to help counselors meet the HUD mandates clarified in MLs 04-25 and 09-10. The requirements for counselors to “…review a client’s unique financial situation…” by documenting “…financial information (e.g. income, assets, debts, monthly expenses)…” and to discuss the “financial implications of and alternatives to a HECM” and “options, other than a HECM, that are available to the homeowners” are included in these MLs. Since Ms Bennett completed her counseling session prior to the release of the new protocol, the counselor was not required to use FIT and BCU, although I wouldn’t be surprised if he did as a service to the client. These tools are meant to be used to promote a conversation about what the client’s goals and needs are so that all options can be explored. The idea is not to pry into personal affairs but to help clients find services for which they may qualify. Clients may choose to not answer certain questions and still get a certificate. Some questions, such as the value of a vehicle or the type of burial account, help the counselor find out if the client is missing out on some of these possible benefits. For example, as I learned recently, a revocable burial account might disqualify one for certain benefits whereas an irrevocable account most probably will not. And the value of one vehicle generally will not disqualify one from benefits but owning two vehicles may. Only clients under 200% of the poverty level are required to go through BCU while all are required to go through FIT. BCU asks for more detailed information concerning assets and debts than FIT does, and, as I mentioned, the client does not have to disclose anything if she or he chooses not to. Counselors do not collect social security numbers or account numbers. Sensitive counselors use the questionnaires as tools to help clients make informed decisions.

  • @the critic:nnTo expand on my post about bank loan conditions: filling out a 1009 is not the same thing as giving a bank months of financial records that show details of my financial life and most frightening of all, my account number.nnYou don’t read about it in the papers, but bank records are hacked every day. Identity theft has been the fastest growing crime in the U.S. every year for years now, yet every day we are required to hand over the information that makes it possible.nnThat information lives forever in the bank’s computers and all it really takes to steal someone’s identity is a name, social security number and snailmail address. Financial records make it even easier.nnI don’t know what FIT and BCU mean (I am assuming they are proposed new requirements of HECM borrowers???), but if such information as car values and burial contracts had been required, I would have canceled my application and managed to live without a reverse mortgage.nnAs to whether elders will follow like sheep to answer any personal question that is asked, you guessed right, critic: unless someone is in desperate straits and has no choice at all, they won’t answer when they believe the questions go too far.nnWe are old but we’re not stupid. And we can’t be bullied.nnI’ll be publishing that last post in my reverse mortgage series tomorrow, 9 September. Aside from the bank’s unreasonable requests, it was an excellent experience. Everyone I dealt with was smart, informed, profession and all-round good guys and women.n

  • In order to get a HECM reverse mortgage on your condo, your condo complex will have to be approved. Whether or not that is possible, there is a process for approval which a competent reverse mortgage originator can help you through. Right now, that process is backlogged because so many projects have been submitted to FHA for approval. Hopefully, as time goes on, the path will be a little smoother.

  • my home, a condo. Some reverse mtge lenders require condo complexes, to be FHA approved- my complex, Village Walk, Wilton, Ct. 06897—rnis NOT. Please let me know of reverse mtge lenders, that DO NOT require FHA approval. rnrn

  • Did Ronni Bennett participate in FIT and BCU? It is doubtful. Just look at how she complains about providing a statement on her investment account: u201cI’m unwilling to send copies of my (so-called) investment account to show the source the remaining funds, so we are working out a method that doesn’t reveal my entire financial life which I’m unwilling to do.u201d Yet she told the lender what her total available assets were on the 1009. rnrnProponents of FIT and BCU scoff when asked what will happen if seniors refuse to answer FIT or BCU questions. Unlike the general counseling questions on the HECM program where it takes 5 right answers on 10 questions to receive a certificate, as to FIT and BCU there are no u201cwrong answersu201d but a senior cannot get a counseling certificate if the senior fails to answer even ONE of the FIT and BCU questions. If the goal of the senior is to get a certificate, not answering one FIT or BCU question results in abject failure. So is the lesson here — it is better to lie than not answer???rnrnIf Ronni has concluded the questions she is being asked are intrusive, imagine how she would feel about BCU questions on the separate values of cars she owns. Then there are the BCU questions on the separate values of revocable and irrevocable BURIAL accounts. rnrnBCU proponents act as if only simpletons would ever think that a senior would be unwilling to answer even one of the questions on either FIT or BCU. Yet here is a genuine supporter of counseling (remember u201cheru201d Buzz in Part 5?), expressing real concern about providing more financial information than she feels is warranted. Who can blame Ronni? rnrnThen look at the comments which follow the blog. Not one commenter sees any value in providing the information which Ronni discusses. Many on that thread see providing this kind of information as u201cthe reasonu201d why not to get a HECM. These are not the comments of those opposed to BCU or FIT; these are the thoughts of the seniors who are following the HECM experience of Ronni.rnrnIt seems FIT and BCU proponents want to sweep the issue under the rug. To date their tactics have been successful. It seems that NCOA has ripped control of counseling away from HUD. The question is why has HUD allowed this to happen? As a genuine HUD and FHA supporter, I find this situation very unsettling.

  • Ronni,rnrnAs usual your candor is welcome and appreciated.rnrnI agree with your points about providing a copy of your investment account. Identity theft is rife and too often overlooked as a reason NOT to supply information to a lender.rnrnFor a loan which supposedly has no credit requirements, it seems ridiculous that the new counseling requirements mandate a complete picture of the finances of a senior as of the date of counseling. Ronni, I hope some at HUD will read your comment about providing too much financial data. Personally I believe there are far more seniors with the same attitude than those at HUD ever want to acknowledge. rnrnIn a matter of months I will join the ranks of those over 62. Reading your online publication and your authors, somehow I do not believe I will suddenly become quite as mentally feeble as some would describe us.rnrnThank you for your detailed articles. They are very helpful. Keep up the good work.rn

  • The Financial Interview Tool (FIT) and the Benefits Check Up (BCU) questionnaire are designed to help counselors meet the HUD mandates clarified in MLs 04-25 and 09-10. The requirements for counselors to “…review a client’s unique financial situation…” by documenting “…financial information (e.g. income, assets, debts, monthly expenses)…” and to discuss the “financial implications of and alternatives to a HECM” and “options, other than a HECM, that are available to the homeowners” are included in these MLs. Since Ms Bennett completed her counseling session prior to the release of the new protocol, the counselor was not required to use FIT and BCU, although I wouldn’t be surprised if he did as a service to the client. These tools are meant to be used to promote a conversation about what the client’s goals and needs are so that all options can be explored. The idea is not to pry into personal affairs but to help clients find services for which they may qualify. Clients may choose to not answer certain questions and still get a certificate. Some questions, such as the value of a vehicle or the type of burial account, help the counselor find out if the client is missing out on some of these possible benefits. For example, as I learned recently, a revocable burial account might disqualify one for certain benefits whereas an irrevocable account most probably will not. And the value of one vehicle generally will not disqualify one from benefits but owning two vehicles may. Only clients under 200% of the poverty level are required to go through BCU while all are required to go through FIT. BCU asks for more detailed information concerning assets and debts than FIT does, and, as I mentioned, the client does not have to disclose anything if she or he chooses not to. Counselors do not collect social security numbers or account numbers. Sensitive counselors use the questionnaires as tools to help clients make informed decisions.

  • @the critic:nnTo expand on my post about bank loan conditions: filling out a 1009 is not the same thing as giving a bank months of financial records that show details of my financial life and most frightening of all, my account number.nnYou don’t read about it in the papers, but bank records are hacked every day. Identity theft has been the fastest growing crime in the U.S. every year for years now, yet every day we are required to hand over the information that makes it possible.nnThat information lives forever in the bank’s computers and all it really takes to steal someone’s identity is a name, social security number and snailmail address. Financial records make it even easier.nnI don’t know what FIT and BCU mean (I am assuming they are proposed new requirements of HECM borrowers???), but if such information as car values and burial contracts had been required, I would have canceled my application and managed to live without a reverse mortgage.nnAs to whether elders will follow like sheep to answer any personal question that is asked, you guessed right, critic: unless someone is in desperate straits and has no choice at all, they won’t answer when they believe the questions go too far.nnWe are old but we’re not stupid. And we can’t be bullied.nnI’ll be publishing that last post in my reverse mortgage series tomorrow, 9 September. Aside from the bank’s unreasonable requests, it was an excellent experience. Everyone I dealt with was smart, informed, profession and all-round good guys and women.n

  • In order to get a HECM reverse mortgage on your condo, your condo complex will have to be approved. Whether or not that is possible, there is a process for approval which a competent reverse mortgage originator can help you through. Right now, that process is backlogged because so many projects have been submitted to FHA for approval. Hopefully, as time goes on, the path will be a little smoother.

  • my home, a condo. Some reverse mtge lenders require condo complexes, to be FHA approved- my complex, Village Walk, Wilton, Ct. 06897—rnis NOT. Please let me know of reverse mtge lenders, that DO NOT require FHA approval. rnrn

  • Did Ronni Bennett participate in FIT and BCU? It is doubtful. Just look at how she complains about providing a statement on her investment account: u201cI’m unwilling to send copies of my (so-called) investment account to show the source the remaining funds, so we are working out a method that doesn’t reveal my entire financial life which I’m unwilling to do.u201d Yet she told the lender what her total available assets were on the 1009. rnrnProponents of FIT and BCU scoff when asked what will happen if seniors refuse to answer FIT or BCU questions. Unlike the general counseling questions on the HECM program where it takes 5 right answers on 10 questions to receive a certificate, as to FIT and BCU there are no u201cwrong answersu201d but a senior cannot get a counseling certificate if the senior fails to answer even ONE of the FIT and BCU questions. If the goal of the senior is to get a certificate, not answering one FIT or BCU question results in abject failure. So is the lesson here — it is better to lie than not answer???rnrnIf Ronni has concluded the questions she is being asked are intrusive, imagine how she would feel about BCU questions on the separate values of cars she owns. Then there are the BCU questions on the separate values of revocable and irrevocable BURIAL accounts. rnrnBCU proponents act as if only simpletons would ever think that a senior would be unwilling to answer even one of the questions on either FIT or BCU. Yet here is a genuine supporter of counseling (remember u201cheru201d Buzz in Part 5?), expressing real concern about providing more financial information than she feels is warranted. Who can blame Ronni? rnrnThen look at the comments which follow the blog. Not one commenter sees any value in providing the information which Ronni discusses. Many on that thread see providing this kind of information as u201cthe reasonu201d why not to get a HECM. These are not the comments of those opposed to BCU or FIT; these are the thoughts of the seniors who are following the HECM experience of Ronni.rnrnIt seems FIT and BCU proponents want to sweep the issue under the rug. To date their tactics have been successful. It seems that NCOA has ripped control of counseling away from HUD. The question is why has HUD allowed this to happen? As a genuine HUD and FHA supporter, I find this situation very unsettling.

  • Did Ronni Bennett participate in FIT and BCU? It is doubtful. Just look at how she complains about providing a statement on her investment account: u201cI’m unwilling to send copies of my (so-called) investment account to show the source the remaining funds, so we are working out a method that doesn’t reveal my entire financial life which I’m unwilling to do.u201d Yet she told the lender what her total available assets were on the 1009. rnrnProponents of FIT and BCU scoff when asked what will happen if seniors refuse to answer FIT or BCU questions. Unlike the general counseling questions on the HECM program where it takes 5 right answers on 10 questions to receive a certificate, as to FIT and BCU there are no u201cwrong answersu201d but a senior cannot get a counseling certificate if the senior fails to answer even ONE of the FIT and BCU questions. If the goal of the senior is to get a certificate, not answering one FIT or BCU question results in abject failure. So is the lesson here — it is better to lie than not answer???rnrnIf Ronni has concluded the questions she is being asked are intrusive, imagine how she would feel about BCU questions on the separate values of cars she owns. Then there are the BCU questions on the separate values of revocable and irrevocable BURIAL accounts. rnrnBCU proponents act as if only simpletons would ever think that a senior would be unwilling to answer even one of the questions on either FIT or BCU. Yet here is a genuine supporter of counseling (remember u201cheru201d Buzz in Part 5?), expressing real concern about providing more financial information than she feels is warranted. Who can blame Ronni? rnrnThen look at the comments which follow the blog. Not one commenter sees any value in providing the information which Ronni discusses. Many on that thread see providing this kind of information as u201cthe reasonu201d why not to get a HECM. These are not the comments of those opposed to BCU or FIT; these are the thoughts of the seniors who are following the HECM experience of Ronni.rnrnIt seems FIT and BCU proponents want to sweep the issue under the rug. To date their tactics have been successful. It seems that NCOA has ripped control of counseling away from HUD. The question is why has HUD allowed this to happen? As a genuine HUD and FHA supporter, I find this situation very unsettling.

  • my home, a condo. Some reverse mtge lenders require condo complexes, to be FHA approved- my complex, Village Walk, Wilton, Ct. 06897—rnis NOT. Please let me know of reverse mtge lenders, that DO NOT require FHA approval. rnrn

    • In order to get a HECM reverse mortgage on your condo, your condo complex will have to be approved. Whether or not that is possible, there is a process for approval which a competent reverse mortgage originator can help you through. Right now, that process is backlogged because so many projects have been submitted to FHA for approval. Hopefully, as time goes on, the path will be a little smoother.

  • @the critic:nnTo expand on my post about bank loan conditions: filling out a 1009 is not the same thing as giving a bank months of financial records that show details of my financial life and most frightening of all, my account number.nnYou don’t read about it in the papers, but bank records are hacked every day. Identity theft has been the fastest growing crime in the U.S. every year for years now, yet every day we are required to hand over the information that makes it possible.nnThat information lives forever in the bank’s computers and all it really takes to steal someone’s identity is a name, social security number and snailmail address. Financial records make it even easier.nnI don’t know what FIT and BCU mean (I am assuming they are proposed new requirements of HECM borrowers???), but if such information as car values and burial contracts had been required, I would have canceled my application and managed to live without a reverse mortgage.nnAs to whether elders will follow like sheep to answer any personal question that is asked, you guessed right, critic: unless someone is in desperate straits and has no choice at all, they won’t answer when they believe the questions go too far.nnWe are old but we’re not stupid. And we can’t be bullied.nnI’ll be publishing that last post in my reverse mortgage series tomorrow, 9 September. Aside from the bank’s unreasonable requests, it was an excellent experience. Everyone I dealt with was smart, informed, profession and all-round good guys and women.n

    • Ronni,rnrnAs usual your candor is welcome and appreciated.rnrnI agree with your points about providing a copy of your investment account. Identity theft is rife and too often overlooked as a reason NOT to supply information to a lender.rnrnFor a loan which supposedly has no credit requirements, it seems ridiculous that the new counseling requirements mandate a complete picture of the finances of a senior as of the date of counseling. Ronni, I hope some at HUD will read your comment about providing too much financial data. Personally I believe there are far more seniors with the same attitude than those at HUD ever want to acknowledge. rnrnIn a matter of months I will join the ranks of those over 62. Reading your online publication and your authors, somehow I do not believe I will suddenly become quite as mentally feeble as some would describe us.rnrnThank you for your detailed articles. They are very helpful. Keep up the good work.rn

  • The Financial Interview Tool (FIT) and the Benefits Check Up (BCU) questionnaire are designed to help counselors meet the HUD mandates clarified in MLs 04-25 and 09-10. The requirements for counselors to “…review a client’s unique financial situation…” by documenting “…financial information (e.g. income, assets, debts, monthly expenses)…” and to discuss the “financial implications of and alternatives to a HECM” and “options, other than a HECM, that are available to the homeowners” are included in these MLs. Since Ms Bennett completed her counseling session prior to the release of the new protocol, the counselor was not required to use FIT and BCU, although I wouldn’t be surprised if he did as a service to the client. These tools are meant to be used to promote a conversation about what the client’s goals and needs are so that all options can be explored. The idea is not to pry into personal affairs but to help clients find services for which they may qualify. Clients may choose to not answer certain questions and still get a certificate. Some questions, such as the value of a vehicle or the type of burial account, help the counselor find out if the client is missing out on some of these possible benefits. For example, as I learned recently, a revocable burial account might disqualify one for certain benefits whereas an irrevocable account most probably will not. And the value of one vehicle generally will not disqualify one from benefits but owning two vehicles may. Only clients under 200% of the poverty level are required to go through BCU while all are required to go through FIT. BCU asks for more detailed information concerning assets and debts than FIT does, and, as I mentioned, the client does not have to disclose anything if she or he chooses not to. Counselors do not collect social security numbers or account numbers. Sensitive counselors use the questionnaires as tools to help clients make informed decisions.

  • Ronni,rnrnAs usual your candor is welcome and appreciated.rnrnI agree with your points about providing a copy of your investment account. Identity theft is rife and too often overlooked as a reason NOT to supply information to a lender.rnrnFor a loan which supposedly has no credit requirements, it seems ridiculous that the new counseling requirements mandate a complete picture of the finances of a senior as of the date of counseling. Ronni, I hope some at HUD will read your comment about providing too much financial data. Personally I believe there are far more seniors with the same attitude than those at HUD ever want to acknowledge. rnrnIn a matter of months I will join the ranks of those over 62. Reading your online publication and your authors, somehow I do not believe I will suddenly become quite as mentally feeble as some would describe us.rnrnThank you for your detailed articles. They are very helpful. Keep up the good work.rn

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