03/08/2025
I’m excited to participate in my first seniors expo! Today at the Bedford Legion from 10 AM to 3 PM.
Of course I offer all mortgage lending options to my clients, however, today I’m promoting the CHIP Reverse Mortgage. What a great financial tool for seniors that want to age in place and access the equity in their home. An option to take a lump sum one time payment of equity in the home to pay down stressful debt, for home renovations to increase the value for home, or for a large expense such as health, expenses, car, or helping a family member, or the ability to access the equity in the home via a monthly retirement income supplement payment. Why a CHIP reverse mortgage… 93% of Canadians want to place in the home they love. You maintain title and ownership of your home, no monthly mortgage payments to be made! Proceeds from the CHIP are tax-free.  inheritance, early inheritance to help with down payment, education, divorce. Death of a spouse, reduced income, surviving spouse, needing to qualify for a revolving credit. Gray, divorce, one spouse, buying a matrimonial home from another. Children’s financial assistance, children are financially assisting their elderly parents. Home care for one spouse, in need of home care or assisted living for one spouse. Financial strain, financial plan, shortfall, need of increasing monthly cash flow.
Myths about reverse mortgages…
The bank owns the home, not true! The homeowner always maintains ownership control of their home and they have the freedom to decide when and if they’d ever like to sell or move out.
Those with a reverse mortgage will owe more than their house is worth. Not true! Home equity banks, CHIP reverse mortgage, conservatively lens, a maximum of 55% of the home appraisal value.
Reverse mortgages are too expensive because the rates are high. Not true. In fact rates are modestly higher than regular mortgage rates because there are no payments required.
A reverse mortgage is a solution of last resort. Not true. Many financial professionals recommend a reverse mortgage because it’s a great way to provide financial flexibility. Since it’s tax-free money, it allows retirement savings to last longer.
The homeowner cannot get a reverse mortgage if they have an existing mortgage. Not true. For clients that have an existing mortgage, the first step is to pay out the previous mortgage with the lump sum payment of the new CHIP mortgage.
A home equity line of credit, HELOC is a better option. Not necessarily. HELOC’s are a good short term borrowing option for people who can pay the interest and loan in the near future. However, HELOC‘s are call of Lohnes with monthly payment obligations in their exist, significant risk for non-renewal or cancellation. In comparison, a reverse mortgage is a long-term financial solution that won’t be called based on economic changes such as interest rate increases, property, values, decreasing, or a change in a homeowner‘s income.
The bank can force the homeowner to sell or foreclose at any time. Not true! Our first mortgage is a lifetime product and as long as the property taxes and insurance are in good standing the property remains in good condition and the homeowner is living in the home. The loan won’t be called even if the house decreases in value. Reverse mortgages provide peace of mind that the homeowner can stay in the home as long as they’d like.
Surviving spouses are stuck with paying the loan after the homeowner passes away. Not true! Surviving spouses can choose to remain in the home without having to make a payment unless they choose to sell the home.
