Four senators are circulating a letter to other lawmakers calling for the restoration of the $88 million in funding for housing counseling programs that was cut from the budget.
According to a report from HousingWire, Senators Robert Menendez (D-NJ), Olympia Snowe (R-NJ), Jay Rockefeller (D-WV) and Daniel Akaka (D-HI) have stated in the letter that they want to see housing counseling funding returned to 2010 levels.
In a study released last month by the Mortgage Bankers Association that examined the impacts of counseling, primarily related to forward mortgages, it was discovered that little is known about how the direct impact these programs have. However, the study did note that a substantial percentage of homeowners who received counseling during loss-mitigation did not redefault.
The $88 million that was cut from the budget during congressional negotiations in April had included $9 million specifically to fund reverse mortgage counseling. Current estimates indicate that funding for free reverse mortgage counseling will dry up by October. Counseling agencies may then increased the cost for counseling services and be forced to limit the number of counselors available for HECM counseling sessions.