California Senate Bill 1609

Language Translation Requirement:
Senate Bill 1609 requires that if negotiations take place orally or in writing for a reverse mortgage in Spanish, Chinese, Tagalog, Vietnamese or Korean that translated loan documents be provided or that the customer provide his or her own interpreter.
Annuities:
Senate Bill 1609 prohibits a lender or broker from:
1. Requiring an applicant for a reverse mortgage to purchase an annuity as a condition of obtaining the loan.
2. Offering an annuity to the borrower(s) prior to the closing of the reverse mortgage or the expiration of the right of the borrower(s) to rescind the reverse mortgage agreement.
3. Referring the borrower(s) to anyone for the purchase of an annuity prior to the closing of the reverse mortgage or the expiration of the right of the borrower(s) to rescind the reverse mortgage agreement.
Counseling:
As required by Senate Bill 1609, prior to accepting a final and complete application or the assessment of any fees for all reverse mortgage loan programs, the prospective applicant must receive counseling from a HUD approved counseling agency. The lender may discuss the program with a potential mortgagor and/or take an initial application prior to counseling but in no event can the borrower(s) be assessed any fees for the processing or payment of any fees to third party vendors prior to the borrower(s) being counseled. In addition, the borrower(s) may not be assessed any fees for the processing or payment of third party vendors if they decide not to complete the transation after counseling has been competed.
The lender must provide a list of at least five HUD approved housing counseling agencies to the borrower(s) which includes at least two agencies that can provide telephone counseling for all reverse mortgage programs.