The Department of Housing and Urban Development announced more than $10 in counseling grants last week, a small portion of which could ultimately make way to HECM borrowers.
The grants, which comprise unspent funding from the 2010 appropriation that was re-competed and then awarded to HUD-approved counseling agencies, are earmarked for mortgage modification and mortgage scam assistance, HUD said. They do not support traditional upfront reverse mortgage counseling but HECM borrowers facing foreclosure could see some of those funds.
“An eligible expense under the grant is counseling homeowners with reverse mortgages that are in a delinquency/default situation,” a HUD spokesman told RMD in an email.
Three million dollars of the funding will go to 139 local housing counseling agencies, and 23 intermediary agencies across the nation will receive the remaining $7 million.
The funding is mainly for foreclosure prevention counseling, application assistance for mortgage modification and loss mitigation programs, and related causes.
And while HECM borrowers could see a small piece, “At this point there is no way to say how much of this grant money will support that specific activity,” the HUD spokesman said.
Due to budget cuts earlier this year, Congress slashed the $88 million HUD previously designated to housing counseling funds for fiscal year 2011. Funding for HECM counseling fell under those cuts, but there has been strong industry effort to restore them.
View a list of the HUD counseling grants.
Written by Elizabeth Ecker
