NRMLA asks Congress to restore HUD housing counseling funds

The National Reverse Mortgage Lenders Association (NRMLA) is urging Congress to restore funding for the Department of Housing and Urban Development (HUD)’s housing counseling program, warning that cuts could disrupt the origination of federally insured reverse mortgages. In a Nov. 2 letter to congressional appropriations leaders, NRMLA President Steve Irwin raised concerns about the presidential pocket rescission of appropriated funds for HUD’s housing counseling program, specifically the funding that supports the Home Equity Conversion Mortgage (HECM) program. NRMLA said independent, third-party counseling is a statutory requirement for every prospective HECM borrower. Under Section 255 of the National Housing Act, borrowers must receive counseling from a HUD-approved agency before a loan can close. A counseling certificate issued by a certified counselor is required for a HECM loan to be legally closed, the trade group said. The association also emphasized that lenders cannot pay for a borrower’s counseling session, direct borrowers to a particular counseling agency or use an agency affiliated with the lender. These restrictions are intended to ensure seniors receive objective in...