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Lally was joined by his Cambridge colleague, Jennifer Cosentini, and Mohan Lalwani, program manager for West Palm Beach, FL-based ReverseMortgageHelper.org. Their panel was part of NRMLA’s 2019 Annual Meeting in November in Nashville. “NRMLA is doing a good job of keeping updates on its website, but I definitely agree,” says Cosentini, Cambridge’s housing director. “In addition to HECM, we’re doing counseling for five other proprietary products. For the counselors, that’s a lot. If we’re doing five sessions a day, it could be about five different products. We have to be up to date. We need to understand the product. We need to know all the different features. We need to have the cor- rect certificate to get all of this off to the lender when we’re done. So, yeah, a little more proactive. If we had information about pending product changes, it would be really nice to get a preview beforehand.” Are there many differences between HECM counseling and that for proprietary reverse loans? “A lot of it is very similar to HECMcounseling as far as loan repayment,” says Cosentini. “Counseling can be a little shorter (with proprietary) because we’re not required to go through a budget. There’s not the same amount of information to present.” The HUD-recommended rate for a counseling session is $125, though it can vary depending on the details and complexity of the transaction. The fee can always be financed and paid from the reverse mortgage proceeds. Counseling agencies will also waive their fee in specific hardship cases or cover the cost from grant proceeds provided by the Department of Housing and Urban Development. And do the HECM protocols relate to the proprietary products as far as counseling? “For the most part, yes,” Cosentini responds. “We have the same guidelines, except we don’t have to go over the FIT—the Financial Interview Tool. But we still do have to go over the borrowers’ needs.” Lalwani confirmed the similarities. “It is 95 percent the same but easier because of components we don’t have to worry about,” says Lalwani. “Borrowers who own a high- value property—let’s say $2.5 to $3 million—they just want to get off the phone in 25 to 30 minutes. They don’t want to waste time on budgeting or anything connected to their personality.” Lally says more affluent borrowers understand things like rates and fees. “It’s simple in that way,” he adds. “They tend to just want to get it done, although I’ve never had anyone say, ‘This was worthless.’ They take something out of the counseling, which is always good.” Lalwani says that, with proprietary loans, the great majority of the borrowers have been educated by their loan officers. “With HECM, it’s different,” he says. With either HECMs or proprietary reverse mortgages, borrowers who haven’t yet decided between the two options, or who are hedging their bets in case they don’t meet FHA’s qualification requirements, counseling can become more complicated by an order of magnitude. “If the borrower changes his or her mind about what product to go with after counseling, that requires another session and different knowledge,” Cosentini explains. “And we have to charge separately each time. We can provide both HECM and proprietary certification, but the loan officer should let us know in advance, because we would need multiple amortization rates and other information.” Lally says he has thought about the possibility of a universal counseling certificate, but he acknowledges that he does not know if that idea would be feasible. “That may [allow] even shorter follow-up sessions,” he says. Lalwani proposes a dedicated website from which such a certificate could be created, an idea supported by Cosentini. HECM certificates are easier to generate from a form, while proprietary products involve a time-consuming Word document that has to be created each time. Counseling certification is valid for 180 days, but FHA may grant an extension if there is already a case Counseling continued on page 24 Jennifer Cosentini Mohan Lalwani Justin Lally REVERSE MORTGAGE / JANUARY-FEBRUARY 2020 23