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Going Forward With Your Best Life
A reverse mortgage is a loan secured against the appraised value of your home and designed exclusively for Canadian homeowners aged 55+ and older. It allows you to convert a portion of your home’s equity into tax-free money all while remaining in the home you love. To be eligible, the home must be your primary residence, typically living in it at least 6 months out of the year. The major advantage of a reverse mortgage is not having to make regular monthly mortgage payments while you are living in the home and only required to pay back the loan when you move out, sell your home, or when you and your spouse pass away.
How much you can borrow will depend on:
You and your spouse’s age
The location of the property
The type of dwelling (condo, detached home, townhouse etc.)
The condition of your home
The home’s appraised value
Your lender
What are the advantages of a reverse mortgage?
At Uptown Financial Mortgages, we understand that as you approach retirement, your financial needs and goals evolve. A reverse mortgage can be a powerful tool to help you achieve greater financial flexibility and security. Live retirement your way with these major advantages you will love:
Manage Retirement Expenses with Ease
Retirement often brings changes to your income, and a reverse mortgage can help fill the gap without depleting your savings. Plus, with no monthly payments required,
you can free up extra room in your budget to focus on what matters most.
Stay in the Home You Love
A reverse mortgage allows you to age comfortably in your own home, avoiding the stress and costs of moving. In many cases, it can even be a more affordable option than
purchasing a new home or renting elsewhere.
Enjoy Tax-Free Funds
The funds you receive from a reverse mortgage are considered a loan, not income, which means they’re tax-free. This also ensures your Canadian Pension Plan (CPP) and Old Age Security (OAS) benefits remain unaffected.
Protection Against Owing More Than Your Home’s Value
With a reverse mortgage, you’re safeguarded by "non-recourse" financing. Even if your balance grows beyond your
home’s value, you or your heirs will never owe more than the property is worth, and your other assets are completely protected.
Support Loved Ones
Reverse mortgage funds can be a way to provide a “living inheritance” to your family. Whether it’s helping with education costs, a first home down payment, or other financial needs, you can lend a hand when it matters most.
a reverse mortgage.
What are reverse mortgages used for?
Take care of your finances
- Pay off debts (line of credit, credit cards, loans etc.)
- Improve cash flow
- Preserve your investments
Invest in your home
- Make repairs on your driveway, roof, HVAC system, and more
- Improve your garden
- Refresh home decor
Give loved ones the gift of a lifetime
- Provide family with an early inheritance
- Help your children buy a home
- Help your child or grandchild with tuition fees
Pursue your passions and interests
- Visit friends and family out of town
- Buy a vacation property
- Pick up a hobby
Look after your health and wellness
- Pay for unexpected medical expenses
- Arrange for in-home care
- Renovate to improve your mobility at home
Supplement your income
- Enjoy social outings
- Host family and friends
- Keep up with the rising cost of living
A conventional mortgage advances you funds to buy property in Canada and requires you to pay back the debt in full plus any interest with monthly payments. A reverse mortgage is the opposite and advances your funds from the house you already own in exchange for equity in your home. There are no scheduled principal or interest payments but the amount you owe will grow over time.
When taking out a reverse mortgage, you can choose how to access the funds in one of these ways:
Lump Sum: Receive the full amount of the reverse mortgage upfront. Keep in mind that interest will begin accruing on the entire amount immediately, which could make this a more costly borrowing option if the funds aren’t used right away.
Line of Credit: Borrow funds as you need them. Interest is only charged on the amount you withdraw, offering a flexible and potentially cost-effective option.
Monthly Payments: Access your funds as a consistent, recurring income stream to help manage your cash flow over time.
Combination: Customize your payout by combining any of the above options to suit your financial needs and goals.
As a reverse mortgage borrower, you have three key obligations to fulfill:
Ensure all property-related expenses, such as property taxes and homeowners’ insurance, are paid on time.
Maintain your home in good condition, keeping it properly repaired and cared for.
Continue using the property as your primary residence.
Discover the full potential of a reverse mortgage
Download our free guide for a detailed explanation of how it works, its benefits, and how it can help you live your retirement your way
Download Here
Request Your Free Estimate
Start with a no-obligation estimate to understand your options.
Consult with a Specialist
Talk to a reverse mortgage professional to learn how much you could qualify for.
Choose Your Fund Distribution
Decide whether to receive your funds as a lump sum, in installments, or a combination of both.
Access Your Tax-Free Funds
Use your funds without making monthly payments until you move or sell your home.
Start Your Journey
Ready to explore the benefits of a reverse mortgage? By understanding how a reverse mortgage works, the benefits and the eligibility criteria, we can help you make an informed decision on whether reverse mortgages are the right choice for you. Contact us today for a free consultation and discover how we can help you unlock the value of your home.
FAQ
No, monthly payments are not required with a reverse mortgage. The loan is repaid only when you sell your home, move out permanently, or pass away.
Yes, you’ll continue to own your home. A reverse mortgage allows you to maintain full ownership while benefiting from any future increase in your home’s value.
Yes, early repayment is an option. However, there may be fees associated with paying off the loan ahead of schedule. It’s important to review your loan agreement for any conditions.
Yes, you can use a reverse mortgage to help buy a new home. Known as a “reverse mortgage purchase,” this option lets you use the loan to cover part of the purchase price, while the remaining cost is paid through other funds.
If your home’s value decreases, you are protected. Reverse mortgages are non-recourse loans, meaning neither you nor your heirs will ever owe more than the current value of the home, regardless of market fluctuations.
Yes, having an existing mortgage won’t prevent you from qualifying. However, you’ll need to use the funds from the reverse mortgage to pay off the remaining balance of your current loan.
Yes, refinancing is available. You can replace your current reverse mortgage with a new one to access more funds or even switch to a traditional mortgage, depending on your financial situation.
In most cases, eligibility is based on the age of the youngest homeowner. Some lenders may have specific programs or conditions for situations where one spouse is under 55, so it’s worth exploring your options with a specialist.