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Roles and Responsibilities of a Reverse Mortgage Counselor

As part of the reverse mortgage process, you will need to work with an approved counselor. This is to protect your best interests by making sure you have a reliable, neutral 3rd party who can help educate you on the process of a reverse mortgage.

You can find a list of HUD-approved reverse mortgage counselors on the HUD website here. The counseling agencies listed on HUD’s website are permitted to provide face-to-face and telephone counseling nationally, so no matter where you are located, any of the counseling agencies on the HUD website may be able to help.

Before you begin reaching out to the various reverse mortgage counselors, here’s what you should know about the roles and responsibilities the counselors have.

[Related: Reverse Mortgage Counseling Fees]

According to HECM (Home Equity Conversion Mortgage – aka Reverse Mortgage) Protocol, the role of the reverse mortgage counselor is to:

  • educate the client about the features of reverse mortgages, the appropriateness of a reverse mortgage, and other financial options that might meet the client’s needs
  • provide guidance and resources to enable the client to make an informed decision, and provide ongoing support to the client throughout the process.

It is not the role of the counselor to tell the client whether or not to proceed with a reverse mortgage, or which reverse mortgage product to use.

In simplest terms, the reverse mortgage counselor is not there to tell you what you should or should not do; they are simply there to help answer questions regarding the process of reverse mortgages and help you understand the loan’s features, benefits, drawbacks and costs before you sign up.

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The responsibilities of the reverse mortgage counselor, according to HECM Protocol, are as follows:

The reverse mortgage counselor must:

  • become familiar with the client’s financial situation
  • provide the client with a discussion of reverse mortgage products and other financial, social service and housing options within the context of his/her financial situation
  • counsel the client on reverse mortgage features
  • provide an overview of financial and/or housing alternatives.

The counselor also must:

  • consider each client’s unique needs and circumstances when discussing the appropriate options for the client
  • must remain objective when discussing various products and options, and
  • must not steer the client in a particular direction or to a particular lender or loan originator.

Working with a HUD-approved reverse mortagge counselor can help you feel more confident going into the HECM process and can give you peace of mind knowing that you fully understand your responsibilities as a reverse mortgage borrower.

In addition to reverse mortgage counseling, HUD also provides counseling in other housing categories, such as foreclosure counseling and homelessness assistance counseling. To learn more about HUD-approved mortgage counseling, visit this link: http://portal.hud.gov/hudportal/HUD?src=/i_want_to/talk_to_a_housing_counselor

Learn more about how people are using home equity conversion mortgages for purchasing homes:

Please keep in mind that the reverse mortgage industry is constantly changing and some of the information contained on this site may not be current. Please ask a licensed reverse mortgage professional for up-to-date guidelines.