The Consumer Financial Protection Bureau launched a tool this week aimed at helping consumers find local housing counseling agencies—including those offering reverse mortgage counseling—to answer their questions or address any concerns they may have.
Along with the tool, released ahead of the January 2014 effective dates for the CFPB’s new mortgage rules, the bureau also published guidance for lenders on how to provide mortgage applicants with a list of local homeownership counseling organizations.
“Consumers need and deserve the best guidance when making the decision to purchase a home,” said CFPB Director Richard Cordray in a statement. “Buying a home may easily be the largest investment a consumer makes, and we want to make it easier for them to find a housing counselor that is a good fit for them.”
The tool uses a search box and mapping function that allows consumers to view the ten nearest counseling agencies to their zip code. It also provides contact information for Department of Housing and Urban Development-approved counselors and displays each service offered by the agencies, whether it’s rental housing counseling, reverse mortgage counseling, or default resolution counseling.
The CFPB released the tool in light of a Dodd-Frank Act requirement that lenders provide consumers with a list of homeownership counseling organizations. Consumers should receive that list soon after applying for a mortgage so they know where to go if they need help deciding what kind of loan to get.
Lenders can fulfill that requirement by using the CFPB-developed lists or by generating their own using the same HUD data the bureau used to build its lists.
For lenders choosing to build their own lists, guidance the CFPB released along with the tool can be used for instructions. The bureau acknowledged that lenders may be unable to provide the lists in time for the rule’s January 10, 2014 effective date and suggests lenders in those situations should consider directing borrowers to the CFPB’s tool to avoid supervisory or enforcement action.
Written by Alyssa Gerace