Reverse Mortgages
Unlock Financial Freedom with Reverse Mortgages in Canada
A reverse mortgage is a unique financial tool designed to help Canadian homeowners aged 55 and older unlock the equity in their homes while maintaining ownership and independence.
Whether you’re looking to supplement your retirement income, cover healthcare expenses, or achieve greater financial flexibility, a reverse mortgage may be the solution you’ve been searching for.
What Is a Reverse Mortgage?
A reverse mortgage allows you to convert a portion of your home’s equity into tax-free cash. Unlike traditional mortgages where you make monthly payments, reverse mortgages allow the lender to pay you—either in a lump sum, regular payments, or a combination of both.
The best part? There are no mandatory monthly mortgage payments. Repayment, including accrued interest, is typically deferred until you sell your home or the last borrower moves out.
Benefits of Reverse Mortgages
Financial Freedom
- Access to Equity: Unlock the value of your home without needing to sell or downsize.
- Tax-Free Cash: The funds are tax-free and can be used for any purpose, such as home renovations, healthcare, travel, or supporting loved ones.
No Monthly Mortgage Payments
- Eliminate the burden of monthly mortgage payments, improving your cash flow and easing financial stress.
- Monthly interest is just added to your mortgage balance while your home’s value keeps appreciating.
Age Advantage
- Older Borrowers Access More Equity: Reverse mortgages work better the older you are, as lenders base eligibility and loan amounts on your age and home equity.
Stay in Your Home
- Maintain full ownership of your property and continue living in your home for as long as
you choose.
As financial expert Ben Stein once said, “The indestructible wealth of a person lies in their home equity.”
A reverse mortgage lets you harness that wealth while maintaining the security of staying in your home.
How Reverse Mortgages Work in Canada
Eligibility
- Homeowners must be 55 or older.
- The property must be your primary residence.
Loan Amount
- Based on your age, home value, location, and
current interest rates. - The older you are, the more equity you can access.
Repayment
- The loan and accrued interest are repaid when the home is sold or the last borrower moves out permanently.
No Income Requirements
- Unlike traditional loans, reverse mortgage eligibility is not tied to your income or credit score.
The Main Reverse Mortgage Lenders in Canada
In Canada, reverse mortgages are primarily offered by two leading lenders: Equitable bank and home equity bank (CHIP Reverse Mortgage).
Equitable Bank Reverse Mortgage
Equitable Bank offers reverse mortgages tailored to borrowers who want more flexibility in how they access and manage their funds.
Pros
- Competitive interest rates compared to other reverse mortgage products.
- Option to secure a lower interest rate for a partial draw (accessing only what you need upfront).
- High borrowing limits for eligible properties.
Cons
- May not be available in smaller towns or rural areas.
- Slightly more stringent property and location requirements.
Home Equity Bank – CHIP Reverse Mortgage
The CHIP Reverse Mortgage is one of the most recognized reverse mortgage products in Canada, designed to offer seniors a way to access their equity without monthly payments.
Pros
- Available across Canada, even in smaller markets.
- Flexible disbursement options: lump sum, regular payments, or a combination.
- No regular income verification required.
Cons
- Higher interest rates compared to traditional mortgages.
- Limited customization compared to equitable bank’s offering.
Equitable Bank vs. CHIP: Key Comparisons
| Feature | Equitable Bank Reverse Mortgage |
CHIP Reverse Mortgage |
| Availability | Urban and suburban areas | Nationwide |
| Interest Rates | More competitive | Slightly higher |
| Borrowing Limits | Higher limits for eligible borrowers | Based on property value and borrower age |
|
Disbursement Options |
Flexible draw options with potential lower rates |
Lump sum, regular payments, or combination |
Why Choose Better Mortgages for Your Reverse Mortgage?
At Better Mortgages, we understand the unique financial needs of retirees and seniors. Our team is dedicated to providing tailored advice and support throughout the reverse mortgage
process.
- Expert Guidance: With decades of experience, we’ll help you understand your options and choose the right reverse
mortgage solution. - Transparent Process: We prioritize clarity, ensuring you fully understand the terms and benefits of your reverse mortgage.
- Trusted Lender Network: We work with leading lenders like Equitable Bank and Home Equity Bank to secure competitive
rates and terms.
Enjoy a better retirement with a reverse mortgage
Take the First Step Toward Financial Freedom
If you’re ready to explore how a reverse mortgage can enhance your financial future, we’re here to help.
Let Better Mortgages help you unlock the equity in your home and achieve financial freedom on your terms.