I 
111TH CONGRESS 
2D SESSION 
H. R. 4419 
To amend section 138 of the Truth in Lending Act to establish certain 
counseling and disclosure requirements with respect to reverse mortgages. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 12, 2010 
Mr. SESTAK introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To amend section 138 of the Truth in Lending Act to 
establish certain counseling and disclosure requirements 
with respect to reverse mortgages. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Reverse Mortgage 
Elder Protection Act’’. 
SEC. 2. COUNSELING AND DISCLOSURE REQUIREMENTS 
FOR REVERSE MORTGAGES. 
Section 138 of the Truth in Lending Act (15 U.S.C. 
1648) is amended by adding at the end the following: 
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‘‘(c) REQUIRED
STATEMENT
REGARDING
COUN-
SELING.—A creditor may not take an application for a re-
verse mortgage unless the creditor has provided to the ap-
plicant for the reverse mortgage, before the applicant re-
ceives any counseling regarding reverse mortgages pursu-
ant to subsection (e), the following written statement, dis-
closed clearly and conspicuously in type that is 16-point 
or larger: ‘IMPORTANT NOTICE TO REVERSE 
MORTGAGE 
LOAN 
APPLICANT: 
A 
REVERSE 
MORTGAGE IS A COMPLEX FINANCIAL TRANS-
ACTION. IF YOU DECIDE TO OBTAIN A REVERSE 
MORTGAGE LOAN, YOU WILL SIGN BINDING 
LEGAL DOCUMENTS THAT WILL HAVE IMPOR-
TANT LEGAL AND FINANCIAL IMPLICATIONS 
FOR YOU AND YOUR ESTATE. IT IS THEREFORE 
IMPORTANT TO UNDERSTAND THE TERMS OF 
THE REVERSE MORTGAGE AND ITS EFFECT. BE-
FORE ENTERING INTO THIS TRANSACTION, YOU 
ARE REQUIRED TO CONSULT WITH AN INDE-
PENDENT LOAN COUNSELOR. A LIST OF AP-
PROVED COUNSELORS WILL BE PROVIDED TO 
YOU BY THE LENDER. SENIOR CITIZEN ADVO-
CACY GROUPS ADVISE AGAINST USING THE 
PROCEEDS OF A REVERSE MORTGAGE TO PUR-
CHASE AN ANNUITY OR RELATED FINANCIAL 
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PRODUCTS. IF YOU ARE CONSIDERING USING 
YOUR PROCEEDS FOR THIS PURPOSE, YOU 
SHOULD DISCUSS THE FINANCIAL IMPLICA-
TIONS OF DOING SO WITH YOUR COUNSELOR 
AND FAMILY MEMBERS.’. 
‘‘(d) COUNSELING CHECKLIST.— 
‘‘(1) REQUIREMENT
FOR
CREDITOR
TO
PRO-
VIDE COUNSELING CHECKLIST BEFORE LOAN APPLI-
CATION.—A creditor may not take an application for 
a reverse mortgage unless the creditor provides to 
the applicant, before his or her meeting with a coun-
seling agency regarding reverse mortgages pursuant 
to subsection (e), a written checklist that complies 
with paragraph (3). 
‘‘(2) REQUIREMENT FOR COUNSELING AGENCY 
TO
PROVIDE
CHECKLIST.—If a consumer seeks 
counseling regarding reverse mortgages before re-
questing a loan application for a reverse mortgage 
from a creditor, the counseling agency shall provide 
the consumer with a written checklist that complies 
with paragraph (3). 
‘‘(3) CONTENTS
OF
CHECKLIST.—A written 
checklist, with respect to an applicant (or consumer, 
in the case described in paragraph (2)), complies 
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with this paragraph only if the checklist meets the 
following requirements: 
‘‘(A) The checklist is in writing in 12-point 
type or larger. 
‘‘(B) The checklist conspicuously notifies 
the applicant (or consumer) under the reverse 
mortgage that he or she should discuss with the 
counselor of the counseling agency the following 
issues: 
‘‘(i) How unexpected medical or other 
events that cause the applicant (or con-
sumer) to move out of the home, either 
permanently or for more than one year, 
earlier than anticipated will impact the 
projected total annual loan cost of the 
mortgage. 
‘‘(ii) The extent to which the appli-
cant’s (or consumer’s) financial needs 
would be better met by options other than 
a reverse mortgage, including less costly 
home equity lines of credit, property tax 
deferral programs, or governmental aid 
programs. 
‘‘(iii) Whether the applicant (or con-
sumer) intends to use the proceeds of the 
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reverse mortgage to purchase an annuity 
or other insurance products and the con-
sequences of doing so. 
‘‘(iv) The effect of repayment of the 
loan on nonborrowing residents of the 
home after all borrowers have died or per-
manently left the home. 
‘‘(v) The applicant’s (or consumer’s) 
ability to finance routine or catastrophic 
home repairs, especially if maintenance is 
a factor that may determine when the 
mortgage becomes payable. 
‘‘(vi) The impact that the reverse 
mortgage may have on the applicant’s (or 
consumer’s) tax obligations and eligibility 
for government assistance programs, and 
the effect that losing equity in the home 
will have on the applicant’s (or con-
sumer’s) estate and heirs. 
‘‘(vii) The ability of the applicant (or 
consumer) to finance alternative living ac-
commodations, such as assisted living or 
long-term care nursing home registry, after 
the applicant’s (or consumer’s) equity is 
depleted. 
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