The National Foundation for Credit Counseling (NFCC) is the recipient of a Housing and Urban Development (HUD) program grant to assist seniors who have taken out a Home Equity Conversion Mortgage (HECM) and who are delinquent on their property charges, such as taxes and insurance, thus putting their home in danger of foreclosure.
The HECM product, also known as a reverse mortgage, allows seniors age 62 and above to tap into the equity in their home without having to vacate the property, and is often used as a tool to increase cash-flow for this age group. In the recent years, many seniors found themselves in a position where they were house rich, but cash poor, and sought relief through a reverse mortgage.Â
The HUD regulations contain specific requirements governing the payment of property charges by the mortgagor.Â This federal program provides additional loss mitigation options available to the borrowers who have a delinquent mortgage due to unpaid property charges.
This new federal program provides additional loss mitigation options available to the borrowers who have a delinquent mortgage due to unpaid property charges.
Through this pilot program, counselors work with the HECM borrowers who are delinquent on their real estate taxes, property insurance, or any other property charges or special assessments such as condominium fees, homeownerâ€™s association dues, etc. Â Assistance is provided at no cost to resolve the delinquency, determine the options for additional financial assistance, explore other housing options, identify resources to provide transitional housing guidance and when appropriate, refer the borrower to a local Area Agency on Aging (AAA) for additional guidance and counseling to assist with the transition.
The NFCC has recruited 25 of its most qualified HECM and loss mitigation counselors from 14 different NFCC Member Agencies across the country to be available as resources for these borrowers, and has created a dedicated toll-free number that consumers should call for assistance (1-866-363-2227).