F2F Counseling Remains In Effect in MA

The Massachusetts legislature this week failed to restore a two-year delay for mandatory face-to-face counseling.

An amendment postponing face-to-face counseling until August 1, 2016 was approved by the House of Representatives, but failed in the Senate. The vote occurred on the final day of Governor Deval Patrick’s administration.

Board member George Downey and Brett Kirkpatrick, both of Harbor Mortgage Solutions, Inc., issued a joint statement following the Senate vote: “We will be meeting shortly with key legislators, NRMLA leadership, and Rasky Baerlein (our government relations specialists) to assess the situation and plan a course of action for this year with the new legislature and the administration of Governor Baker. We are most grateful for your support, assistance, and participation in numerous meetings with legislators this past year to resolve this critical matter for MA seniors.  And, we look forward to your continued help this year.  We will keep you updated as developments occur.”

Until the matter is settled, current law requiring face-to-face counseling for borrowers who fall within the income threshold remains in effect.

In-person counseling requirements apply to “mortgagors,” which are defined as applicants for a reverse mortgage who at the time of application: (1) have a gross income of less than 50 percent of the area median income, as periodically determined by HUD; and (2) possess assets, excluding a primary residence, valued at less than $120,000. 

If an applicant meets the definition of “mortgagor,” before a reverse mortgage is closed, the lender must receive written certification of in-person counseling relating to the appropriateness of the reverse mortgage. The written certification must come from a counselor with a third-party organization that is approved by the Massachusetts Executive Office of Elder Affairs. Massachusetts regulations implementing the Act indicate that for HECM products, the HECM counseling certificate promulgated by HUD can be used to satisfy the written certification requirement.