Mortgage Industry Officials Warn of Halt to Reverse Mortgage Originations

Posted by Dinesh Kumar on December 24th, 2021

Hundreds of senior citizens seeking financial stability through reverse mortgages could see their plans grind to a halt unless the Massachusetts Legislature acts to extend the governor’s COVID emergency order that expired Dec. 15.

At issue is a state law that mandates in-person counseling for all reverse mortgage applicants. Massachusetts is the only state in the nation that does not allow reverse mortgage counseling by phone or videoconference.

However, Gov. Charlie Baker in April 2020 introduced a COVID-related measure that temporarily permitted counseling by phone or videoconference. That measure, which made it possible for seniors and counselors to interact without fear of COVID transmission, expired on Dec. 15.

Had the Legislature extended the order as was expected, the crisis would have been avoided.

A bill, H1146, that would make telephone and video counseling permanent is pending. That bill likely won’t be acted upon until next spring. In the meantime, senior homeowners are left with the dilemma that legislative inaction created.