Figuring Out the People in Your Mortgage: Counselor

Your first stop on the road to reverse mortgages is the counselor. They’re not here to analyze your childhood or interpret your dreams; instead, these counselors offer up sound advice and the information necessary for you to make an informed decision about your own loan. They are required to remain completely unbiased and can only give you the facts — they never tell you what to choose or take away your power to make the best choice for you. It sounds great now, but come choosing time, you may probably wish someone would just tell you what to do!

Even the most independent homeowners are required to seek the advice and educational offerings of an approved counselor. Typically, an “approved” counselor refers to HUD-approved, but Fannie Mae and Financial Freedom each have their own set of preferred counselors. Unless you know for a fact that you need the Home Keeper or Cash Account loan, it’s usually best to see a HUD counselor. These professionals are acceptable for any of the major loans discussed in this book, and if you decide to get an HECM (even after you’ve been to a Fannie Mae or Financial Freedom counselor) you still need to make an appointment with a HUD counselor as well. You can save time and energy by going to a HUD-approved counselor from the get-go.

Many counselors (especially HUD) operate free of charge, although some have a nominal fee for their services (usually around $75). Unless you live in an area where the only counselor for 50 miles charges a fee, try to use one who’s free. The ones who charge offer the same exact information, so if you have a choice, go with the free ride.

During your counseling session, the counselor asks you all sorts of personal questions about your finances, your health, your family, your home, and your lifestyle. Don’t keep anything from them or stretch the truth even a little bit. Counselors only have about an hour with you and need all the information they can get in that time to show you the options that may work best for you. It can be a bit off-putting to spill the beans to a stranger, but it’s necessary to make a smart decision regarding your loan. You can rest assured that counselor sessions are completely confidential — only you and your counselor have access to the information you provide, unless, of course, you bring someone with you to the meeting.

It’s a good idea to bring along any trusted family members or friends who may be able to help you get a better perspective, supply information, ask questions you hadn’t even thought of, or just lend you some moral support. Counselors encourage families to come together, and you may probably find that you’re glad to have someone else there. This isn’t a requirement by any means, but consider it when you make your appointment.