A new California reverse mortgage counseling law is scheduled to take effect on January 1, and the Department of Housing and Urban Development informed counselors and reverse mortgage lenders on how to prepare for the legislation.
The bill, California Assembly Bill 2010 requires that reverse mortgage counseling be conducted in person unless the borrower opts out.
Counselors are being instructed by HUD to continue using the current counseling certificate with an addendum designed by the National Reverse Mortgage Lenders Association that allows a borrower to opt out, in writing, to the face to face counseling. It also allows the counselor to collect additional information from the borrower.
“AB 2010 requires additional information to be collected, above and beyond what is contained in the HECM Counseling Certificate,” according to NRMLA. “Counselors will be required to complete the addendum, or some such document, for applicants in CA, but Lenders’ Quality Control departments will need to ensure that such information as required by AB 2010 is included in the applicant’s file.”
Written by Elizabeth Ecker