Under the Act, the terms of a reversernmortgage executed with a mortgagor who did not receive the appropriaterncounseling are unenforceable and additional regulations from the MassachusettsrnDivision of Banks make issuing a loan without providing the counseling groundsrnfor termination of a lender’s reverse mortgage program approval and may alsorntrigger fines and administrative penalties.</p

Now for the confusing part. The bill,rnwith an effective date of August 1, 2012 was passed on July 26 and sent tornGovernor Deval Patrick for signature.  However, the legislature passed a second billrnon that same date which changed the effective date of the first bill to Augustrn1, 2014.  Absent a signature or a veto fromrnPatrick, both bills automatically become law in ten days.</p

Now we will just let FHA explain what isrngoing on.</p

“As of late afternoon July 31,rn2012, the Governor had not signed the Bill. As a result, effective August 1, 2012,rnreverse mortgage lenders must comply with the Act’s in-person counselingrnrequirements until the Governor signs the Bill. As drafted, the Bill delayingrnthe Act’s in-person counseling requirements becomes effective immediately oncernthe Bill becomes law. However, the provision delaying the effective date of thernAct’s in-person counseling requirement is not retroactive and will not applyrnduring the period from August 1, 2012 until the bill is enacted.”</p

FHA advises reverse mortgagernlenders and counselors to be prepared to comply with the counselingrnrequirements as of August 1 in the event the governor signs the bill.  If he takes no action for ten days afterrnreceiving the bill, “the in-person counseling requirement will apply on August 1, 2012 and berneffective until August 6, 2012 then delayed until August 1, 2014.</p

Got that?</p

However, FHA does assure lendersrnthat seniors who received counseling on or before July 31 and were issued arncounseling certificate will not require re-counseling in the event the Governorrndoes not sign the Bill into law on July 31, 2012.</p

Anyone reading this will bernforgiven if they are now reciting under their breath an old Abbott and Costello routine thatrnonce applied only to baseball.

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