December 16, 2016
Housing counseling is an important resource for those who want to apply for a mortgage loan. When borrowers decide to start on the journey to home ownership, there can be many areas they are unsure about.
That’s one reason why it can be helpful to contact the FHA directly at their toll-free number (1-800 CALL FHA) to request a referral to a local, HUD-approved housing counselor to get expert advice and help in areas related to budgeting for a mortgage payment, credit issues, the home loan process and more.
In some cases, certain types of counseling are actually required as a condition of FHA loan approval; this is true for FHA Home Equity Conversion Mortgages (HECM), where all borrowers must attend counseling to insure they understand the nature of HECM loans, their terms, and the rules that affect when the loan is due and payable.
A recent press release on the FHA/HUD official site announces changes to HUD’s requirements for HUD-approved housing counseling. According to HUDNo.16-190, ” The U.S. Department of Housing and Urban Development (HUD) today announced it will require that housing counselors participating in HUD programs to be certified to offer counseling services to consumers.”
For housing counselors to be HUD-certified, the press release states they must “pass a standardized written examination and work for a HUD-approved housing counseling agency (HCA). Counselors must demonstrate competency in each of the following areas of housing counseling:
(1) financial management;
(2) property maintenance;
(3) responsibilities of homeownership and tenancy;
(4) fair housing laws and requirements;
(5) housing affordability; and
(6) avoidance of, and responses to, rental and mortgage delinquency and avoidance of eviction and mortgage default.”
According to the HUD official site, the new requirements go into full effect “three years following the release of the certification examination. To help counselors prepare for the exam, the Department is offering intensive training and study resources (in English and Spanish) to its counseling stakeholders.”
A practice test will be available soon while the actual certification test is “expected to be published in the Spring of 2017”.
The official site adds, “Once HUD’s rule is fully implemented, housing counseling required by HUD or provided in connection with any HUD program will meet common standards and will be delivered by a HUD certified counselor working for a HUD-approved housing counseling agency.”
The agency says it will provide an “online database of HUD-approved housing counseling agencies and certified counselors for consumers and partners to rely upon. HUD certification will allow consumers to quickly find a trusted, impartial and knowledgeable advisor who is required to put the consumer’s best interests first.”
We will publish updates to this story as they become available.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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