The Mandatory Counseling Session: Your First Step

If you’re still considering a reverse mortgage after weighing the pros and cons, your first official step is to attend a counseling session. This is not optional; it is required by federal law for anyone seeking a HECM reverse mortgage, and for a very good reason: to protect you.

The session is conducted by a counselor from an independent agency approved by HUD. This person does not work for any lender and does not sell any financial products. Their only job is to provide you with impartial information and help you make a fully informed decision.

During your counseling session, which can usually be done in person or over the phone, you can expect the counselor to:

Explain the loan in detail: They will review how a reverse mortgage works, the different payment options, and the costs and fees involved.

Discuss your responsibilities: They will make sure you clearly understand your obligation to pay taxes and insurance and maintain your home.

Analyze your financial situation: They will look at your income, assets, and expenses to help you determine if you can afford the ongoing costs of homeownership.

Talk about alternatives: They will discuss other options that might be available to you, such as other types of loans or government and community assistance programs.

This is your opportunity to ask every question you can think of in a safe, no-pressure environment. Come prepared with a list of your concerns. After you complete the session, you will receive a certificate. You cannot submit a reverse mortgage application without this certificate.

You can find a list of HECM counselors in your area on the official HUD website or by searching through the resources provided by the Consumer Financial Protection Bureau (CFPB).