What are the basic counseling requirements for an FHA reverse mortgage?

Housing counseling is required for any borrower who wants an FHA Home Equity Conversion Mortgage (HECM/reverse mortgage) and it must occur before a borrower incurs any costs for the loan.

The counseling may be face to face or by telephone. FHA prefers face-to-face counseling; however, FHA recognizes that many seniors prefer telephone counseling for a variety of reasons.

For seniors who cannot or who choose not to travel to a housing counseling agency and who cannot be visited by a counselor in their home, FHA permits HUD-approved telephone counseling agencies to offer HECM counseling.

HECM counselors are required to adhere to all FHA’s guidelines regarding information that must be provided and must tailor the session to address the unique financial circumstances of the household. In order to conduct this review, a counselor must document a client’s budget based on financial information provided by the client. The budget analysis is necessary to enable counselors to evaluate and discuss appropriate alternatives to a HECM.

Detailed information regarding counseling requirements may be located at the following websites:


MLs: 09-10, 08-28, 08-12, 06-25, 05-44, 04-48, 04-25, 04-18, and 00-10; Handbook 7610.1, Rev.5

All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.

Topic Number: KA-05077