Minnesota Session Laws - 1991, Regular Session

  

                         Laws of Minnesota 1991 

                        CHAPTER 201-S.F.No. 1411 
           An act relating to housing; requiring counseling for 
          reverse mortgage loans; providing penalties; amending 
          Minnesota Statutes 1990, section 47.58, by adding a 
          subdivision. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1990, section 47.58, is 
amended by adding a subdivision to read: 
    Subd. 8.  [COUNSELING; REQUIREMENT; PENALTY.] A lender, 
mortgage banking company, or other mortgage lender not related 
to the mortgagor must keep a certificate on file documenting 
that the borrower, prior to entering into the reverse mortgage 
loan, received counseling as defined in this subdivision from an 
organization that meets the requirements of section 462A.28, 
subdivision 1, and is a housing counseling agency approved by 
the Department of Housing and Urban Development.  The 
certificate must be signed by the mortgagor and the counselor 
and include the date of the counseling, the name, address, and 
telephone number of both the mortgagor and the organization 
providing counseling.  A failure by the lender to comply with 
this act results in a $1,000 civil penalty payable to the 
mortgagor.  For the purposes of this subdivision, "counseling" 
means the following services are provided to the borrower: 
    (1) a review of the advantages and disadvantages of reverse 
mortgage programs; 
     (2) an explanation of how the reverse mortgage affects the 
borrower's estate and public benefits; 
     (3) an explanation of the lending process; 
     (4) a discussion of the borrower's supplemental income 
needs; and 
     (5) an opportunity to ask questions of the counselor. 
    Presented to the governor May 23, 1991 
    Signed by the governor May 27, 1991, 10:40 p.m.