Jan-Feb2020

number. For an issue, such as HECM for Purchase where a client has not yet found the house he or she wants, a recertification can be accomplished quickly and relatively inexpensively, on the order of $50. Another issue that counselors face is ensuring that borrowers are best prepared for the counseling session. “All owners must participate in counseling,” says Lally. “It is not helpful when a son or daughter who has been given some ownership in the property calls us a week later, and we have to say, ‘If a borrower added children to the title of the house, then yes, even a nonborrowing owner or spouse has to go through the counseling.’” Cosentini says the process can get tricky. “How do you even charge nonborrowers?” she says. Lally adds that couples sometimes decide after a session that one of them will be a non-borrowing spouse. “We can’t just change the certificate,” he says. “We have to have another conversation, which can cause a holdup.” Then there is the problemof making sure the borrowers have all the papers and documents as the session starts, so there is no confusion or wasted time. Lally recommends that a loan officer call the day before, reaching out to remind the borrower which documents they have to have in front of them, such as the amortization schedule, loan comparison and TALC— or Total Annual Loan Cost—that is the reverse mortgage equivalent of the Annual Percentage Rate Truth in Lending disclosure. Lalwani suggests that, from the entire loan package, those particular documents and pages that are needed for the counseling session should be highlighted. He also cautions that the loan package should be realistic in terms of what the borrower plans to do with the proceeds, observing that often the documents do not reflect that. And this issue is on the loan officer. Lally agrees: “We see this on a fairly regular basis. So, if you’re not doing your due diligence, please do so.” Also, says Lalwani, “If things like documents or numbers have to be updated before the counseling session because of, say, a change in interest rates, you should let the counselor know beforehand, even though HUD frowns on direct communication. It can effect principal limits and all kinds of factors.” And all three veteran counselors stressed that loan officers should convey any special circumstances before the counseling session. For a hearing-impaired client, for example, every agency should have the proper telephone facilities available. “I like to have a family member on who can convey the information to the client,” says Lalwani. “We prefer to do it with Skype so we can also observe the body language. The same thing applies with language differences.” A standard part of the protocol is that counselors have to follow up with clients in 60 to 90 days, which is part of the required quarterly report to HUD. Only then can the client file be closed. Currently, counselors have to pass a test every three years and participate in continuing education every two years. Beginning in August 2020, Cosentini points out, counselors must also pass a test granting them HUD housing certification, which is not an easy job. “So, at that point, you’re going to see the number of counselors go down,” she says. For that and other reasons, she adds, perhaps the most important component of the counseling process is, “You have to like what you do,” Cosetini says. “You have to have faith in these products, even though you have to be completely impartial with these clients. So, there is a lot of education involved. We try our hardest to keep up to date on everything because that’s in the best interests of the client. But there’s so much to learn, and if you’re a counseling agency that’s small and doesn’t do many sessions, that could be a problem. There is so much to keep up with, you have to love what you do.” Counseling continued from page 23 “You have to have faith in these products, even though you have to be completely impartial with these clients. So, there is a lot of education involved.” —Jennifer Cosentini, Cambridge Credit Counseling 24 REVERSE MORTGAGE / JANUARY-FEBRUARY 2020