aDiamondMortgage – The Difference MortgageTM
Find out what a reverse mortgage can do for you.
A reverse mortgage is a loan secured against the value of the home. Unlike a loan or a regular mortgage, you are not required to make regular mortgage payments. The loan is repaid only when the homeowners no longer live in the home.
The loans are typically promoted to older homeowners and typically do not require monthly mortgage payments. Borrowers are still responsible for property taxes or homeowner’s insurance. If you are a senior and have been in your home for some time, a reverse mortgage will allow you to take the equity in your property without making back any payment until you leave or sell the property.
Use it to:
- Pay off debts,
- Handle unexpected expenses,
- Help children or grandchildren,
- Improve day-to-day standard of living,
- Make a special trip or purchase
- Just about anything you want
A reverse mortgage in Canada is a financial product designed for homeowners aged 55 and older, allowing them to access the equity in their home without selling it. Here are the key features of reverse mortgages in Canada:
Eligibility and Terms
- Available to homeowners aged 55 or older
- Borrowers can access up to 55% of their home’s value
- The home must be the borrower’s primary residence
- Minimum home value requirement of $250,000
How It Works
- Provides tax-free funds as a lump sum or regular monthly deposits
- No regular mortgage payments required
- Interest accumulates on the borrowed amount
- Loan becomes due when the last surviving owner dies, the house is sold, or the homeowner moves out
Advantages
- Allows seniors to access home equity without selling
- No monthly payments required
- Borrowers retain ownership of their home
- Funds can be used for any purpose
Considerations
- Higher interest rates compared to traditional mortgages
- Setup fees, appraisal costs, and closing expenses may apply
- May reduce the estate value for heirs
- Borrowers must maintain the home and pay property taxes and insurance
Reverse mortgages in Canada offer a way for older homeowners to supplement their income or access funds for various purposes while remaining in their homes.
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