Reverse Mortgage Counselors Prepare for New Rules With Hurdles Ahead

With implementation of the financial assessment just over a month away, the new rules’ impact on reverse mortgage counseling agencies — as well as the industry at large — has yet to be seen. 

But industry stakeholders agree it will place a greater demand on counseling agencies’ resources, raising ever-looming funding concerns as agencies ramp up training efforts to prepare for the financial assessment’s March 2 implementation date. 

While the Department of Housing and Urban Development (HUD) continues to roll out guidance and planned February training around the financial assessment’s implementation, counseling agencies are already allocating extensive resources to their own training—as best they can.


“The greatest impact will be the training piece of it,” says Sue Brown, vice president of reverse mortgage counseling with ClearPoint Credit Counseling Solutions, noting that ClearPoint will participate in training provided by HUD and NeighborWorks, and will also schedule internal trainings to supplement the industry training. “I would anticipate that each counselor will participate in several hours of training and testing over the next four to six weeks.”

Training is a top priority for all agencies as they prepare to assist clients after the changes are implemented, says Bruce McClary, vice president of public relations and external affairs for the National Foundation for Credit Counseling (NFCC). 

“Our member agencies have invested considerable time and resources to help prepare participating staff,” he says, adding that “the cost of preparation has been mentioned as a common challenge.”

While agencies are beefing up training efforts to prepare for the financial assessment’s implementation, some counselors are expressing concerns that counselor-specific guidance regarding the new rules hasn’t been issued soon enough.

“I will be taking an upcoming webinar – primarily designed, it appears, for servicers and underwriters – but so far there has been little provided so we, the counselors, can be adequately prepared,” says Ed Beckstrom, of Illinois-based Consumer Credit Counseling Services (CCCS). “Also, there have been no changes that I have seen in information and other tools provided to counselors to share with clients regarding reverse mortgages. I feel current information is dated and might be misleading to those we provide the information to.”

HUD did not respond to requests for comment by the time of publication.

Written by Cassandra Dowell

Join the Conversation (5)

see all

This is a professional community. Please use discretion when posting a comment.

  • Counselors and counseling agencies have to be pulling their hair out about now. Can any of us really give a good reason why all of these changes were really necessary along with why so many??

    I don’t know about the rest of you but I hate to get up in the morning, go to work and check to see what new mortgagee letters have come out! Have a great day all.

    John A. Smaldone

    • John,

      The real question is why are counseling agencies and counselors so worked up about financial assessment which only lenders must perform? As to the responsibility of counseling itself, this is much ado about NOTHING.

      Originators have risk in each financial assessment performed in the originating process. Counseling can cause unnecessary second guessing in their financial assessment referred to as FIT and BCU causing a counselee to drop out of the application approval process. HUD in its Guide and lenders in its analysis based on the HUD Guide can cause a loan to be rejected or an applicant to become unnecessarily overly wrought until they withdraw their application. Remember originators get nothing unless an application closes as a HECM or some other kind of reverse mortgage.

      It seems like as to the extent that counseling should be involved in presenting the financial assessment lenders do, the RM Maven may gotten it about right in the comment he/she made yesterday.

      So maybe you can explain to us why counseling seems so worried about understanding all of the details of Mortgagee Letter 2014-22 and its linked guide. It would seem that a simple reading of that ML and one training session on it for counselors by HUD would suffice. For an ambitious counselor, an industry presentation may be appropriate.

      But there should be no significant change in training due to the financial assessment which lenders must perform in accordance with Mortgagee Letter 2014-22 and its linked guide.

    • John,

      Getting up in the morning, combined with anything else, you have got to be kiddin’?

      On the serious side, I hear your frustration but that is the stage we are in the industry. We have left the grade school phase of our industry’s maturity and are now in the college phase. As industries mature, things generally come quicker and do not get simpler.

      • Critic,

        I hear you loud and clear. I am just very concerned that what gets issued one day gets changed the next. We are trying to get a grasp on everything, which is not the easiest thing to do these days? You make it a great day and thanks for your reply’s to me.


string(113) ""

Share your opinion