The Mortgage Bankers Association (MBA)’s policy advocacy group, the Mortgage Action Alliance (MAA), is urging its members in the state of Massachusetts to support the continued use of remote telephone and video counseling for reverse mortgages in the state following the lapse of an exemption allowing for remote counseling.
“The provision in state law which permitted these forms of consumer counseling on reverse mortgage loans expired on March 31st via sunset,” the call explained. “Importantly, language has been introduced to emergency funding legislation that would restore these forms of counseling and make this flexibility permanent. Importantly, that language was only included in the House passed version of the emergency funding bill.”
Specifically, MAA is calling on its members to contact their representatives in the State House and Senate to urge their support of Sections 11 and 12 of H.4466, the reconciled version of the emergency budget bill.
These two sections modify existing state law to allow for counseling sessions to be conducted “by synchronous real-time video conference or by telephone,” according to the text of the bill.
The differences between the House and Senate versions of the bill are expected to be reconciled this week, according to the MAA notice. According to its most recent update on the website for the Massachusetts legislature, the committee conference implementing the reconciled version was appointed on Mar. 28.
The issue of a face-to-face reverse mortgage counseling provision has remained a specter over the state’s reverse mortgage business for years. Massachusetts is the only state in the country to require in-person reverse mortgage counseling, a requirement that caused issues and effectively halted its reverse mortgage business during the early days of the COVID-19 pandemic.
Since then, there have been multiple efforts to implement and renew time-limited exceptions that allow for phone or video counseling, with certain reverse mortgage professionals within the state working in concert with trade associations to advocate for a permanent solution. While one came close to becoming law in 2023, the necessary language was ultimately not included in a budget bill and another temporary exception was put into place.
That exception expired at the end of the day on Mar. 31, but reverse mortgage industry veteran George Downey of The Federal Savings Bank in Braintree, Mass. — who has been a critical figure in the advocacy for a permanent solution — said it could happen this time.
“We’ve done as much as I think reasonably could be done to get the information to the surface so that the conference committee members, when they were evaluating these various amendments, would have some sense of what this is about and how important it is,” Downey told RMD late last week. “So, I feel a measure of confidence in that regard. I’ll be optimistic and give us 50% odds.”
Last year, MBA President and CEO Bob Broeksmit signaled that the association would be more involved in the reverse mortgage industry in 2024.
“I think that given the demographics of this country and given the record levels of home equity, it makes perfect sense for our members to focus on that product, [and to] make it as strong and sustainable, both for lenders and servicers and of course for the homeowners and their families, as it can be,” Broeksmit said in December.
