Housing Counseling FAQ

If an agency provides reverse mortgage counseling for a proprietary product, such as a reverse mortgage with a specific lender, to a client, is this expense eligible for reimbursement under the Housing Counseling Comprehensive NOFA?

Date Published: August 2018

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For a service to be eligible for reimbursement under a HUD grant, the services provided must meet the requirements outlined in Chapter 4: Reverse Mortgage Counseling of the Housing Counseling Handbook.

Additionally, eligible activities and basic requirements of housing counseling will be outlined in the applicable NOFA, which should be reviewed.

In general, for a counseling session to meet the requirements for reimbursement, the counselor must, at a minimum, perform and document each of the following activities related to reverse mortgage counseling:

  1. Budget/Financial Analysis. A review of the client's income, expenses, spending habits, and use of credit in order to evaluate their unique financial situation relative to their housing needs.
  2. Housing Analysis. A review of the client’s housing needs, current housing quality, and housing affordability relative to their financial capability.
  3. Discuss Alternatives. Identify and discuss with the client at least three (3) alternatives or options available to the client, including Federal Housing Administration (FHA) programs and products if applicable, relevant to the specific housing need. For example, if a particular company, loan product, property, or debt management program is discussed, the counseling must include a detailed discussion of alternative companies, loan products, properties, debt management programs, etc.
  4. Follow-up. Efforts made by the counselor to have follow-up communication with the client, to ensure that the client is progressing toward his or her housing goal(s), to modify or terminate housing counseling services, and to determine and report outcomes.

While the agency may have met all the requirements for this proprietary product, these expenses do not become eligible until the above HUD-required elements have been provided.

Please also see FAQ 3327 for guidance related to the use of multiple funding sources to pay for housing counseling services provided to a single client.

Tags: Housing Counseling Program HECM Counseling Requirements

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