What happens when you die with a reverse mortgage

A reverse mortgage is a loan that allows homeowners to borrow against the equity in their home. It can be a great way for seniors to access cash without having to sell their homes. However, it’s important to understand all of the details before you decide if a reverse mortgage is right for you. In this guide, we will discuss everything you need to know about reverse mortgage counseling.

Reverse mortgage counseling is done through an in-person or telephone training session. Independent third-party counselors approved by HUD (U.S. Department of Housing and Urban Development) must conduct counseling sessions. The counselor will go over all of the details of a reverse mortgage. He/She will explain how it works, the benefits and risks of a reverse mortgage, the advantages and disadvantages of applying for one, and other important information

Key Takeaways

  • A reverse mortgage loan is a complicated loan; counseling helps borrowers understand reverse mortgages and protects them from scams, frauds, and predatory lending.
  • Counseling will also help you understand how the reverse mortgage works, your responsibilities as a borrower, and the steps involved in obtaining a reverse mortgage loan.
  • The reverse mortgage counselor will have to go through all of the specifics with you. He will describe how it works, the advantages and dangers of a reverse mortgage, the benefits and drawbacks of applying for one, and other pertinent information.

What exactly do reverse mortgage counselors do?

Reverse mortgage counselors’ main responsibility is to educate the borrower about reverse mortgages and help borrowers understand how to use their Reverse Mortgage loans. Reverse mortgage counselors are independent third parties hired by opens in a new windowHUD-approved housing counseling agencies that provide unbiased assistance in order to meet each borrower’s needs while helping them achieve their goals. Reverse mortgage counselors are trained with knowledge of Reverse Mortgages but are not offered any compensation from Reverse Mortgage lenders.

The Reverse Mortgages Counseling can go over the step-by-step process of Reverse Mortgage Lending, including:

  • Benefits and risks of a reverse mortgage
  • How does reverse mortgage work
  • Borrower responsibilities
  • Tips for choosing a lender
  • Steps required in the funding process

After your consultation and completion of the assessment, the reverse mortgage counselor will provide the certificate required as part of the loan application.

Who is required to complete reverse mortgage counseling?

Any borrowers including non-borrowing spouses interested in a HECM reverse mortgage must receive counseling. In addition, any remaining owner of a life estate or any other party who holds title to the property and are not eligible borrowers must receive counseling.

What happens during reverse mortgage counseling?

During the counseling session, the counselor will focus on educating the borrower(s) on how reverse mortgages work. The counselor will go over the risks associated with reverse mortgages.

The borrower will also have the opportunity to ask the counselor any questions they may have about reverse mortgages. The borrower will be informed that he or she is not required to take out a HECM reverse mortgage loan nor is it their obligation to accept a Reverse Mortgage loan if they are approved.

How long is the reverse mortgage counseling session?

The session should usually last no more than 90 minutes but can be as long as necessary. Counseling sessions can take place either face-to-face or via telephone; counselors have been trained to deliver the required information regardless of the method of communication. Loan originators or reverse mortgage lenders are not permitted to direct you to any particular reverse mortgage counselor.

How much does reverse mortgage counseling cost?

Reverse mortgage counseling costs usually range between $125-$200, but it may vary depending on the location, and counseling provider.

The counseling will be paid for in full by the borrower, the lender cannot pay for the counseling. This is another safeguard that ensures counselors are impartial. Homeowners can also contact the counseling agency to ask for a reduced fee if they are experiencing financial hardships.

What happens after your counseling session? 

Once you have completed your counseling you will be sent a certificate. It is recommended that you sign and return this certification to your lender should you proceed with the processing of the loan if this has occurred. There will be no third-party services ordered unless your certificate of authorization and approval is completed by the bank.

How long is a reverse mortgage counseling certificate good for?

This reverse mortgage certificate is valid for 180 days. In almost every state the certificate should be valid after assignation to case numbers for the HECM loans but the loan can close if the certificate has expired. In other states, such as Texas the license must be unexpired at the closing or the borrower would have to finish another consultation to close the loan.

Why is reverse mortgage counseling a requirement?

A reverse mortgage loan is a complex loan, counseling helps borrowers better understand reverse mortgages and also helps to protect them from scams, frauds, and predatory lending. Although HECM (home equity conversion mortgage) is a government-insured loan, it is important to understand the risks and benefits associated with this type of loan. Counseling will also assist you in understanding how the reverse mortgage works, what are your responsibilities as a borrower, and what are the steps in taking out a reverse mortgage loan.

What should I do if I have a problem with my counseling provider?

Consumers who feel that they were not satisfied with their reverse mortgage counseling session may file a complaint or grievance on the HUD (U.S. Department of Housing and Urban Development) website at: http://www.hud.gov.

To get started in scheduling your reverse mortgage counseling session, check our our recommended list of (HUD) U.S. Department of Housing-approved Reverse Mortgage Counseling agencies below:

AgencyService FeesPhoneWebsiteHECM Approved
Cambridge Credit Counseling$125888-764-7460VisitYes
QuickCert, Inc.$125888-383-8885VisitYes
Smart Money Housing$125800-403-3807VisitYes


Reverse mortgage counseling is a mandatory requirement in order to get a reverse mortgage. While a loan like HELOC doesn’t require counseling, it is very important that the borrower has a clear understanding of how reverse mortgages work. The counseling must be provided by a HUD (Housing and Urban Development) approved counselor. There’s a lot that goes into this loan, therefore a reverse mortgage counseling session can be critical in helping you understand your options and make an informed decision. You will also get a clear understanding of the reverse mortgage process, and what’s expected of you.

If you’re still not sure after reading this post, give me a call or schedule a free consultation. I’m here to help!

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