Through HUD, the U.S. Government developed the reverse mortgage program to help seniors live out their golden years in their own home without undue financial worries. The last thing the government wants is a program where seniors are financially abused. For that reason, the U.S. Government has implemented the following safeguards:
- Mandatory Counseling: Anyone that gets a HUD sponsored reverse mortgage must complete a HUD approved counseling session, either over the phone or in person at a HUD approved counseling service. The purpose of this counseling is to make sure that you are clear on the ins and outs of a reverse mortgage, and that a reverse mortgage is relative to your personal situation.
- Fees and interest: To ensure seniors are not taken advantage of, all reverse mortgage interest rates and fees are capped by the U.S. Government: The U.S. Government regulates the fees, closing costs and interest rate that can be charged on a reverse mortgage. It is of the utmost concern to the U.S. Government that seniors not be subjected to undisclosed fees or high fees and expenses. The government has strict caps in place as to the fees, expenses and interest rates on a reverse mortgage loan.