Housing and Urban Development Secretary Alphonso Jackson recently announced a $44 million housing counseling and counseling training grant. “This Administration strongly believes in the value of housing counseling services,” said Jackson. “These organizations help families make informed choices before they take the important step of homeownership. They also provide a service that is vital in today’s mortgage market – they counsel families facing foreclosure and advise them about their options.”
$3 million is being awarded in supplemental funding for Home Equity Conversion Mortgage (HECM) counseling which was recently exhausted in March of this year. In August HUD approved counseling agencies were allowed to start charging for counseling sessions. Below I outlined some of the statements that I found interesting:
HUD is clarifying that it will allow for participating agencies to accept funding from lenders, as long as the relationship does not create a conflict of interest and that the relationship is disclosed to the client.
To make things even more confusing HUD issued this guidelines on counseling agencies being able to charge fees.
agencies may charge reasonable fees to clients, as long as the fee does not place a hardship on the client. Acknowledging that a client’s ability to pay a fee is based on factors beyond the client’s income, HUD revised the requirement that a fee be based solely on the client’s income. The housing counseling agency may make a determination about a client’s ability to pay based on factors, including, but not limited to, income and debt obligations. Clients should not be turned away because of an inability to pay. Agency fee schedules, as well as determinations of clients’ ability to pay, are subject to review by HUD during periodic monitoring conducted in accordance with Sec. 214.307. In another change from the proposed rule, HUD removed the provision that HUD would pre-approve an agency’s fee schedule. Instead, HUD will review fee schedules during a review of an agency’s application for [[Page 55640]] approval or a performance review, in order to ensure that the fees are consistent with fees charged by similar agencies providing similar services. If a housing counseling client believes that he or she has been unreasonably denied access to counseling because of a fee or other dispute, the client should contact the local HUD field office or HUD Headquarters.
Now that HUD is issuing another $3 Million for HECM counseling does this mean that counseling agencies can’t charge until the money is exhausted?
To read a copy of the press release click the link below.
Bush Administration Announces $44.1 Million in Housing Counseling Grants (RISMedia.com)
Technorati tags: Reverse Mortgage, Reverse Mortgage News, HECM, HECM Counseling, HUD, FHA
