If you are providing a reverse mortgage, do not – repeat – do not think of trying to sell an annuity at the same time.

Federal agencies have made that point, several times, in a new batch of “final guidance,” or official advice, on reverse mortgage sales compliance management.

The agencies that teamed up to issue the guidance or the Office of the Comptroller of the Currency, the Federal Reserve System, the Federal Deposit Insurance Corp., the Office of Thrift Supervision and the National Credit Union Administration.

A reverse mortgage is a financial instrument that consumers ages 62 and older can use to tap home equity without having to make payments while they are living in the home.

The new guidance, which will take effect Oct. 18, gives ideas about strategies financial institutions and other entities involved with marketing reverse mortgages can use to avoid taking advantage of older consumers, or looking as if they are doing so.

“Reverse mortgages present substantial risks both to institutions and to consumers, and, as with any type of loan that is secured by a consumer’s home, it is crucial that consumers understand the terms of the product and the nature of their obligations,” according to the text of the guidance.

In a section on “Conflicts of Interest and Abusive Practices,” the guidance states that, “The potential for inappropriate sales tactics and other abusive practices in connection with reverse mortgages is greater where the lender or another party involved in the transaction has conflicts of interest, or has an incentive to market other products and services.”

In that section, the agencies refer explicitly to annuities:

For example, when a consumer obtains funds through a reverse mortgage, the consumer could also be offered financial products, such as annuities or non-financial products, such as

home repair services. Such products and services may be inconsistent with consumers’ needs, and, on occasion, have been known to be associated with fraud. The risk is especially strong where, for example: (1) The lender or its affiliate engages in cross-marketing of another financial product; (2) the other product is sold at the same time as the reverse mortgage product; (3) a significant portion of the proceeds of the reverse mortgage is used to purchase another product; or (4) in contrast to the reverse mortgage itself, the other product would not provide the consumer with funds to meet emergency needs or to pay ordinary living expenses.

An institution that offers reverse mortgages should adopt clear written policies and internal controls designed to ensure that the institution does not violate anti-tying restrictions, the guidance says.

“An institution risks violations if it… Requires the borrower to purchase any annuity, insurance or any product other than a traditional banking product in order to obtain the reverse mortgage from the institution or an affiliate,” the guidance says.

An institution might violate conflict-of-interest rules if it “requires the borrower to purchase any annuity, insurance (other than appropriate title, flood or hazard insurance), or similar financial product from the institution or third party in order to obtain the reverse mortgage from the institution or broker,” the guidance says.