Reverse mortgage counseling relief in Mass. passed by legislature, permanent fix possibly revived

The Massachusetts state legislature on Thursday delivered a $101 million bill to the desk of Gov. Charlie Baker, offering new funding for relief related to the COVID-19 coronavirus pandemic and — critical to the reverse mortgage industry operating within the state — extensions to early pandemic emergency relief provisions that allow for remote notary services, public meetings and remote reverse mortgage counseling.

This is according to reporting by the Massachusetts-based State House News Service, information on the legislature’s website and discussions with reverse mortgage professionals based within the state.

The measure as it is will be promptly sent to the desk of Gov. Baker, and will go into effect immediately after he signs it into law. The new extension will remain in effect through July 15, 2022 barring any additional developments.

The new amendment: extending reverse mortgage counseling relief

Previous remote counseling relief expired in December and caught the reverse mortgage industry off guard since longer-term solutions designed to allow for the continuation of phone or video-based counseling have been deliberated for months, predating the last extension of the deadline that was handed down in June, 2021.

At that point, Gov. Baker extended the pre-existing deadline allowing telephonic and video counseling an additional six months. After December’s expiration of that relief, reverse mortgage industry activity was put in danger of moving forward once more and legislators debated another extension. While the State House passed a bill that would’ve restored remote reverse mortgage counseling through the summer in January, the State Senate amended the bill further, adding $46 million and additional COVID-19 relief to the package. Those alterations required reconciliation between the State House and Senate prior to Thursday’s passage.

“[D]ue to the outbreak of the 2019 novel coronavirus, also known as COVID-19, and subsequent variants, written certification from a counselor with a third-party organization that a mortgagor has received counseling via a synchronous, real-time video conference or by telephone in lieu of counseling in person shall satisfy the requirements [of state law], however, that the third-party organization shall have been approved by the executive office of elder affairs for purposes of such counseling,” the relevant amendment in the newly-passed legislation reads.

State legislators praised the quick work of both houses in passing a revised version of the bill, which now goes to the governor’s desk for codification into law.

“With this agreement, we support our ongoing pandemic response efforts by including $75 million for masks, rapid tests and vaccine equity efforts that support children, educators, front-line health care workers, small businesses, our most vulnerable populations and communities disproportionately impacted by this pandemic,” Ways and Means Co-Chairs Sen. Michael Rodrigues and Rep. Aaron Michlewitz said in a joint statement on Thursday morning.

During the COVID-19-induced state of emergency, more than 400 reverse mortgage counseling sessions have been conducted through video or telephonic means according to the Massachusetts Mortgage Bankers Association (MMBA), a measure taken to decrease the likelihood that older Massachusetts residents would be exposed to COVID-19 or its more aggressive variants.

Massachusetts remains the only state in the country that requires reverse mortgage counseling sessions to be completed in person, and like much of the rest of the nation is grappling with a new wave of COVID-19 infections brought on by the more virulent “Omicron” variant.

In reaction to the news, George Downey of Harbor Mortgage Solutions based in Braintree, Mass. praised the work of both MMBA and the National Reverse Mortgage Lenders Association (NRMLA) in getting the latest extension passed.

“This would never have happened if we did not have the support of the MMBA,” Downey told RMD. “They were very key in helping and supporting this initiative from the beginning. In addition to that, NRMLA and MMBA in combination were absolutely terrific and essential. This would not have happened without their support.”

Potential movement on a permanent solution, other issues

While a bill that aimed to permanently address the in-person counseling requirement was filed as early as March 2021, the proposed legislation appears to be stalled without additional deliberation based on publicly-filed information made available by the Massachusetts state legislature. That proposed bill — designated H.1146 — was referred to the Joint Committee on Financial Services at the end of March 2021 with no additional movement.

However, that bill was reported out favorably from the Joint Financial Service Committee on Wednesday, February 2, according to a reverse mortgage professional that is active within the state. It remains to be seen whether or not the proposed bill can make it through the full legislative process to also be sent to the governor’s desk, but if it manages to do so then reverse mortgage counseling sessions would be permitted “by synchronous real-time video conference or by telephone” on a permanent basis, according to the text of the proposed bill.

However, the form of counseling is only one such issue for the state’s reverse mortgage business. Both the MMBA and in-state reverse mortgage professionals have described a persistent lack of available counselors approved by the Massachusetts Executive Office of Elder Affairs and the U.S. Department of Housing and Urban Development (HUD). That shortage of available counselors remains the most immediate concern for the reverse mortgage business related to the state’s expired relief and is compounded by seniors’ anxiety related to COVID-19.

State-approved counselors that can offer the in-person sessions are a minimal resource, with only five full-time counselors and one part-time counselor able to provide such services in the state. These figures regarding the number of available counselors are unchanged from figures shared with RMD in June of 2021 and were reiterated in a letter submitted by MMBA to the state legislature in December.

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