Reverse mortgage counseling agencies will receive $4 million in grants to be allocated across agencies this year. The Department of housing and Urban Development today announced the funding as part of $42 million in total housing counseling grants.
“This will help lower the cost of [reverse mortgage] counseling,” HUD Secretary Shaun Donovan told RMD in a press call following the announcement. “Without these grants, that service would either not be available or would be significantly more expensive.”
Some reverse mortgage counseling agencies reported following the funding cuts that they were forced to raise the cost of counseling to potential borrowers beyond the traditional $125 fee. Others, which had previously been able to offer free counseling, had to reintroduce fees. The discrepancy led to longer wait times for those seeking the counseling as a result.
The initial reception of the funding is positive, says Scott Scredon, director, public relations for housing counseling agency CredAbility.
“We’re very pleased with HUD’s decision to provide this level of housing counseling support,” Scredon told RMD. “It will help us serve so many more seniors.”
CredAbility will use the funds to provide free counseling for approximately 2,400 individuals who qualify as low income borrowers.
Especially in light of the housing crisis, counseling has proven essential for millions of American families, Donovan said.
“During this crisis, the services have become indispensable,” he said. “More than 6 million families have been helped.”
Written by Elizabeth Ecker