National Aging in Place Week

NRMA reports that activities the commemorate National Aging in Place Week are starting to take shape in communities around the country. It was first celebrated in 2003 and is scheduled this year from October 8-14.
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Is There A Cost For Couseling?

Currently, there is no cost to the consumer for counseling. However, HUD is considering a proposal to make counseling a borrower-paid expense to be disclosed on the HUD-1 (escrow closing statement).

Who Provides HECM Counseling?

According to the NRMLA Summer publication, HUD has approved approximately 800 non-profit organizations nationwide to provide HECM counseling. There are counselors who do mostly face-to-face counseling,and then there are individuals who are part of HUD's nationwide telephone counseling network.

Either type of counselor can advise a prospective borrower in-person. Except in special circumstances, only counselors who are part of the telephone counseling network can conduct nationwide (except North Carolina which permits face-to-face only) phone counseling.

Non-network counselors may only counsel over the phone if the client resides in the same state as the counselor or a contiguous state, and if the client has a mobility or medical problem which restricts travel, or if no counseling is located within 50 miles of the client's home.

Most telephone counseling is conducted by one of three entities approved by HUD in Mortgagee letter 2005-44: National Foundation for Credit Counseling, Money Management International and AARP.

When a senior calls AARP, a he/she is given a list of counselors and their telephone numbers. The other agencies automatically route the senior to the next available telephone counselor, no matter where that counselor is located, or to the nearest branch if the person requests a face-to-face counseling session.

HECM Counseling

Arguably the most important consumer protection built into the reverse mortgage program is the requirement that the prospective borrower must first meet with an independent third party counselor approved by the U.S. Department of Housing and Urban Development (HUD) before signing a loan application or incurring any fees for the reverse mortgage. Each counselor is trained thoroughly and test to assist a senior interested in obtaining this product.

NRMLA states that by law, a couselor must review other options, with the senior, that are available including housing, social services, health and financial alternatives such as sale-leaseback financing or property tax deferral programs. They also need to inform the borrower of the tax consequences affecting eligibility under state or federal programs and the impact on the estate and their heirs.

HUD Proposes Program Changes

The U.S. Department of Housing and Urban Development will be issuing several mortgagee letters in the near future that make beneficial changes to the FHA reverse mortgage program, according to Meg Burns, Director of HUD's Single Family Program Development Division.

Addressing a luncheon crowd at the fifth annual Reverse Mortgage Day of Texas, held in Austin, on July 26, Burns noted the following program changes that HUD is in the final stages of reviewing:

A mortgagee letter to make counseling a borrower-paid expense disclosed on the HUD-1 form.
A mortgagee letter to extend the principal limit lock period from 60 days to 120 days
A mortgagee letter to eliminate an existing requirement that borrowers present a Photo ID.
HUD has already implemented a new policy whereby the department provides 10 days advance notice of any FHA loan limit increases. This, in turn, gives lenders an opportunity to obtain more funds for their clients.

Both Burns and FHA Commissioner Brian Montgomery are speaking at NRMLA's Annual Meeting & Expo in San Francisco, September 28-30. Attendees will have an opportunity to ask more detailed questions about the HECM program, and other FHA issues. To learn more about the Annual Meeting visit NRMLAOnline.org.

HECM volume Cap Removed

The Reverse Mortgage Advisor Volume 9.2, Summer 2006 reads "House Passes Legislation that Removes HEVM Volume Cap, Implements National Loan Limit". The the article states that the U.S. House of Representatives passed legislation, with a vote of 415-7, known as the Expanding American Homeownership Act of 2006 (H.R. 5121), which would make substantial improvements to the FHA HECM program. President Bush issued an immediate statement thanking the House and urged the Senate to pass its own version, S.3535.

This initiative, passed on July 25, would create a single national loan limit for the HECM program equal to the conforming Freddit Mac loan limit ($417,000 in 2006); establish a "home purchase" option tha would allow people to use a reverse mortgage to purchase newer housing that better suits their needs; and remove the volume cap on the numbe rof HECM loans that FHA can insure. read more...

Access Greater Amounts of Equity

Financial Freedom has Launched a new version of its "jumbo" product, called the Cash Account Advantage, as reported in the Reverse Mortgage Advisor Summer edition. This will enable them to be competitive with the federally insured Home Equity Conversion Mortgage by enabling homeowners living in properties valued between $450,000 and $750,000 to access greater amounts of equity. read more...

Reverse Mortgage Movie

Signing Pro has been featuring their Reverse Mortgage movie titled "What About Me" at NRMLA conferences for the past two years. The movie includes a narration with real life scenerios played by seniors ranging in age from 63 to 93.

Your potential clients will enjoy the story lines and relate easily to the characters, while at the same time assisting seniors in understanding the benefits of what a Reverse Mortgage can do to enhance their future. For a nominal fee Reverse Mortgage Loan Agents can embed their logo, photo and phone number into the story line.
To view the movie trailer visit our Reverse Mortgage Resource Center at www.signingpro.com.

43% Not Saving Enough to Retire

Study: 43% not saving enough to retire well

On June 6, 2006 an article written by Kathy Chu with USA Today stated that a new retirement study provides further evidence that a growing number of Americans are at risk of a diminished standard of living once they stop working.

The Center for Retirement Research's new retirement-risk index, released Tuesday, shows 43% of working households were in danger in 2004 of having too little income to fund their retirement.

But the study probably understates the proportion of retirees at risk. Its projections assume that people retire at age 65, cash in on their home equity through a "reverse mortgage" and exchange their assets for a stream of income by buying an immediate annuity. read more...

Take a Break in Maui, Hawaii

One of the most important comments that every seminar leader suggests you do is take some time for you. Take a Vacation! And Maui is the greatest place to do this. There's nothing better than some rest and relxation to refresh your state of mind and develop creative ideas. The flights are amazingly low if you search around on the web and until November you can catch low season condo rates to make your stay more comfortable. Bring a loved one who has been waiting for you to give them your special time.

I've included a website where you can preview fun activities and get an idea of what's going on around the island of Maui, Hawaii. vacationinwailea.com