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House approves reverse mortgage counseling bill after debate over government role
Summary
House Bill 7, defining reverse equity mortgages and authorizing counseling through the Division of Aging and Adult Services, passed after amendments; debate focused on whether counseling should be provided by government-certified counselors or left to private/market actors. Vote was 57–15 in favor.
The Utah House on the floor approved House Bill 7 to define reverse equity mortgages and establish an information-and-counseling service tied to the Division of Aging and Adult Services, with a modest fiscal cost but potential state budget savings if older homeowners use pensions to remain independent. The bill passed in amended form by a recorded vote of 57–15.
Sponsor Representative Fred R. Huntaker described the bill as intended to help elderly homeowners access equity in their homes without forcing sales or institutional care: "What this bill does is it defines what a reverse equity mortgage does... and it provides counseling through the division of aging and adult services." He said counseling would be provided by certified counselors and that HUD requires certification for counselors associated with reverse-mortgage programs.
Several members raised concerns about government provision of counseling and whether the state is the appropriate actor to offer financial counseling. Representative Reber said he was "concerned... how the government is gonna fill this need" and worried that government counseling could be inferior to private services. The sponsor and other supporters countered that certified, independent counseling is already a HUD requirement and that the Division of Aging is the logical place to provide unbiased, qualified counseling. Representative Bradshaw proposed an amendment to ensure informational materials identify alternatives to reverse mortgages; that amendment was adopted.
Members also questioned counselor qualifications, contract provisions for outlying areas, the role of mortgage lenders and required disclosures, and sunset/repeal mechanics for related agencies and programs. Supporters noted counseling can prevent foreclosures and reliance on welfare programs by enabling seniors to remain financially independent.
The House passed the bill with amendments (including an explicit counseling and alternatives provision) by a vote of 57 affirmative and 15 negative. The measure will be transmitted to the Senate for further consideration.
Next steps: HB7, as amended, is referred to the Senate.
