A bill passed by the Massachusetts state House of Representatives would delay a forthcoming mandate to require face-to-face reverse mortgage counseling for certain qualifying prospective borrowers.
Reverse mortgage and counseling advocates have worked toward delay of the face-to-face mandate, which was originally introduced in 2010 and has subsequently been delayed twice, with the current implementation date set for August 1, 2014.
If passed by the state senate and signed into law, the bill, H. 4181 would push the delay further, to August 1, 2016.
Under the mandate, low-income seniors would be required to receive reverse mortgage counseling in person rather than over the phone. Lenders and counseling agencies have expressed concerns over the mandate, citing the lack of counselors in certain areas of Massachusetts that are not in close proximity to major cities. Many seniors will have difficulties accessing the counseling, those advocates have said, putting additional time and stress into the counseling process and raising the costs as a result.
Further, lenders have said they may be forced to suspend lending in Massachusetts if the mandate does go into effect.
Those seniors meeting the low income requirements must have gross incomes less than 50% of the area median and assets, excluding their primary residence, valued at less than $120,000, according to a NRMLA member newsletter sent this week.
NRMLA and key stakeholders have held recent meetings and events in an effort to educate the legislature and other key players of the challenges associated with the face to face requirement.
Written by Elizabeth Ecker