Free Reverse Mortgage Guide
Learn everything you need to know before taking out a reverse mortgage.
Written by a licensed mortgage agent and Chartered Accountant -
you won't find the information contained in this free guide anywhere else.
Get all the facts you need before making this important financial decision.
A Reverse Mortgage Is A Confusing Product
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Our free guide will set you on the way by showing you everything there is to know about these mortgages so you can make an objective and informed decision - understanding exactly what it is and how it works in Canada.
The Top 3 Things You Will Learn:
All the pros and cons of a reverse mortgage.
A comparison to a Home Equity Line Of Credit (HELOC) and other mortgages.
All the facts that you must be aware of before making your decision.
- Erich S, Ontario
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- Mike, BC
What Is A Reverse Mortgage? Check Out Our Video...
Frequently Asked Questions About Our Services And Reverse Mortgages In Canada:
What Is A Reverse Mortgage In Layman's Terms?
A reverse mortgage is a specialist mortgage product only available to people in Canada over the age of 55 - it is called this because - unlike other mortgages - it doesn't require regular monthly payments.
It is specifically for seniors to help supplement retirement funds. This is why it is only available to those older than 55.
The purpose is to allow you to withdraw equity from your home without having to make any repayments towards a mortgage. The lender makes their money through charging interest on the balance withdrawn - but instead of the interest being paid each month (like a normal mortgage or Home Equity Line Of Credit), it simply accrues against the balance owed. That is, it is added to the balance owed.
The amount that can be taken out is no more than 55% of the value of the home. However, this amount is tiered - so at 55 years of age you would not qualify for the full 55% but rather a smaller percentage. This is so you don't eat up your home equity during your retirement.
There is one central goal to this product: to allow you to stay in your home for life.
Upon all homeowners passing away, the lender will then recover the balance owed - including both the equity amount and interest - through your Estate. This will be either by the house being sold or re-mortgaged.
Does The Guide Apply To The USA?
No, this guide is for the Canadian product - currently offered by CHIP HomEquity Bank. In the U.S.A there were a lot more reverse mortgage problems - because they are a completely different product in the U.S. compared to Canada – I would say that they are considered much more risky and less beneficial for you than the Canadian version. Therefore this guide only covers the Canadian product as it is the one I know inside out.
Does This Apply To My Province?
Yes, they are available all across Canada. For more see our Reverse Mortgage Canada page. You can rest assured that we have all the information you need covered in our free guide.
(Please note that at present these are not available in the Yukon.)
What Is CHIP?
CHIP stands for the 'Canadian Home Income Plan'. While many people know this as CHIP, it is actually the previous name of this product and plan. It was changed to 'reverse mortgage' to more accurately reflect the type of product this is. The goal remains the same, however, to help provide seniors with additional income in or entering your retirement years.
What Are The Current Reverse Mortgage Rates?
Rates change over time - like any mortgage product. However, with this product in particular you must think about more than just the rates. For example, one thing that you absolutely must consider is home equity growth - this is what can help you keep (or even increase) your home equity over time. These mortgages are really a question of home equity growth rates vs interest rates - your home equity growth can often offset the interest rates completely.
For more on this, check out our free reverse mortgage rates and penalties article.
Do You Have A Reverse Mortgage Calculator?
We are working on this but a calculator - and amortization schedule - are not something that should impact this decision. We cover this in great detail in our free guide.
Why Did You Write This Guide?
If you have done any research about this mortgage product, you will have noticed that there are not many unbiased, impartial and objective guides for a savvy senior out there.
That's why we created this guide with the real pros and cons of a reverse mortgage in Canada.
In addition to this, there is also a lot of confusion and misinformation surrounding them. For example, many people out there are confused about whether or not they could potentially lose their home.
(Let me set this one straight off the bat - I can tell you right now that the answer is no - never under any circumstances will you or any Canadia lose your home with this plan. But the mere fact that people are confused by this and asking these questions is a testament to how poor the information out there is.)
So I created and wrote this free guide so that you can educate yourself and decide if this is the right financial solution for you during your retirement years.
How Often Do You Update This Guide?
We have been working on this guide for months - putting together the information and updating it as we are asked more questions and get more feedback. We have also used our contacts with lenders and experience as mortgage agents to ensure that all the information contained inside is accurate. I genuinely believe that there is no other guide to this product as comprehensive as this.
The guide is fresh – we update it regularly – and our goal has been to include absolutely everything there is to know about this product.
If you feel like we have missed something, then let us know - we are always writing new articles and sending out new information on a regular basis.
What If I Already Have The Information I Need And Just Need Some Advice?
If you already know quite a bit and are pretty sure that this might be a good option for you, we have you covered too.
Scrolls to the top of the screen and hit 'free assessment' - you can then take our 90 second reverse mortgage assessment and you will get your own dedicated professional to look at your details and advise you if this is the right financial option for you. As the name suggests, it only takes 90 seconds of your time.
Who Are You?
I am a licensed mortgage agent with Dominion Lending Centres Edge Financial – FSCO License #10710. I am also a certified Chartered Accountant.
Our mortgage brokerage is independently owned and operated – this means that you get independent, objective and professional advice on all of your mortgage and other financial needs. We don’t work for any bank or lender – you are our client.
We are also affiliated with Dominion Lending Centres – the number one mortgage company in Canada for any kind of mortgage.
You can check out our sister site - GTA Mortgage Pros.
How Much Does This Cost?
Just so you have it in black and white: our guide, our 90 second assessment and all the advice and recommendations we provide you are completely, totally, 100% free - you will never pay us a penny ever for any of our advice.
How Will I Receive The Guide?
The guide is a PDF file (opens with Adobe or any PDF or eBook reader). I will email it to you immediately. I will also continue to send you other free tips, tricks and advice to help you along the way – you can unsubscribe any time if the guide is more than enough for your needs.
Who Offers A Reverse Mortgage In Canada?
The 'big 5 banks' - RBC, BMO, CIBC, Scotiabank and TD do not offer this product in Canada. The reason is that this is a very specialist product that requires years of investing and input before the bank sees any returns.
At present, it is only offered by HomeEquity Bank - who are a regulated and chartered bank.
If you have any further questions then please let me know! Make sure and check out the free guide first though - a lot of work went into it!
- Michael Sneddon CPA, CA