NRMLA President Steve Irwin wrote to congressional appropriations leaders on Nov. 2, urging them to restore funding for HUD's housing counseling program after a presidential pocket rescission of appropriated funds. The trade group warned that cuts could disrupt reverse mortgage originations.
Federal law requires all Home Equity Conversion Mortgage (HECM) borrowers to receive counseling from a HUD-approved agency before closing. A counseling certificate from a certified counselor is mandatory for loan closure under Section 255 of the National Housing Act.
Lenders cannot pay for borrowers' counseling, direct borrowers to specific agencies, or use affiliated counseling firms. This restriction ensures seniors receive objective information about reverse mortgage costs, obligations, and alternatives.
Because lenders are prohibited from funding or steering the counseling process, NRMLA said federal appropriations are essential to maintain the independent counseling infrastructure needed for HECM originations. Without the funding, counseling could become less accessible and affordable, creating obstacles to loan closings and limiting seniors' access to the federally insured reverse mortgage program.
"We respectfully urge you to take the necessary action to restore the appropriated HUD housing counseling funds so that eligible seniors may continue to benefit from the HECM program," Irwin wrote.
NRMLA represents more than 300 member companies and more than 2,000 member delegates. Its members originate more than 90% of reverse mortgages.