Unlock Your Home Equity Without Selling
Reverse Mortgages for Canadian Seniors 55+
Access tax-free cash from your home equity with no monthly payments. Stay in your home and enjoy financial freedom in retirement.
What is a Reverse Mortgage?
A reverse mortgage, also known as the Canadian Home Income Plan (CHIP), is a loan that allows Canadian homeowners aged 55 and older to access the equity in their home without selling it. Unlike a traditional mortgage where you make monthly payments to the lender, a reverse mortgage pays you.
You can receive up to 55% of your home's appraised value in tax-free cash, which you can use for any purpose. The loan, along with accumulated interest, is repaid when you sell your home, move out, or pass away. Until then, you make no monthly mortgage payments.
This financial tool is designed specifically for Canadian seniors who want to supplement their retirement income, pay for healthcare expenses, help family members, or simply enjoy a more comfortable retirement without leaving their home.
How It Works
Qualify
You're 55+ and own your home in Canada
Get Approved
Home appraisal and simple approval process
Receive Funds
Get cash as lump sum or regular payments
No Payments
Stay in your home with no monthly payments
Repay Later
Loan repaid when you sell or move
Eligibility Requirements
Age Requirement
You must be at least 55 years old. If there are multiple homeowners, the youngest must be 55+.
Own Your Home
Your home must be owned (or have a small mortgage) and located in Canada.
Primary Residence
The home must be your primary residence where you live most of the year.
Sufficient Equity
Your home must have sufficient equity based on its appraised value and location.
Key Benefits
Unlike traditional mortgages, you don't make monthly payments. The loan is repaid when you sell your home or move.
Continue living in your home for as long as you wish. You retain ownership and control of your property.
Funds received from a reverse mortgage are tax-free and don't affect Old Age Security or Guaranteed Income Supplement.
Receive funds as a lump sum, regular payments, or a line of credit - whatever suits your needs best.
Approval is based on your age and home equity, not your credit score or income.
There are no restrictions on how you use the money - it's your equity, your choice.
How Canadians Use Reverse Mortgages
There are no restrictions on how you use your reverse mortgage funds. Here are some popular ways seniors are using this financial tool:
Supplement Retirement Income
Cover daily living expenses and maintain your lifestyle
Home Renovations
Make your home more comfortable and accessible
Healthcare Costs
Pay for medical expenses and in-home care
Help Family
Support children or grandchildren with education or home purchases
Pay Off Debts
Eliminate high-interest debt and reduce financial stress
Travel and Lifestyle
Enjoy retirement and fulfill lifelong dreams
Costs & Important Considerations
Reverse mortgage interest rates are typically higher than traditional mortgages, ranging from 6% to 9%. While you don't make monthly payments, interest accumulates over time and is added to your loan balance. The longer you have the loan, the more interest accrues.
Typical fees include:
- Home appraisal: $300-$400
- Legal fees: $1,000-$1,500
- Closing costs and administrative fees
- No application fees with major providers
The loan balance (principal plus interest) must be repaid from your estate, usually through the sale of your home. This reduces the inheritance for your heirs. However, any remaining equity after the loan is repaid goes to your beneficiaries. The no-negative-equity guarantee protects you and your estate from owing more than the home's value.
Before proceeding with a reverse mortgage, consider these alternatives:
- Home Equity Line of Credit (HELOC) - Lower rates but requires monthly payments
- Downsizing to a smaller, less expensive home
- Renting out part of your home
- Government programs and benefits you may be eligible for
- Family loans or assistance
Reverse Mortgage Calculator
Get an estimate of how much you could borrow with a reverse mortgage
How Much Can You Borrow?
Loan amounts are based on your age, home value, and location. Generally, you can borrow between 20% and 55% of your home's appraised value. The older you are, the more you can borrow.
| Age Range | Maximum LTV | Example |
|---|---|---|
| 55-59 | 20% | $100,000 on $500k home |
| 60-64 | 25% | $125,000 on $500k home |
| 65-69 | 30% | $150,000 on $500k home |
| 70-74 | 40% | $200,000 on $500k home |
| 75-79 | 45% | $225,000 on $500k home |
| 80+ | 55% | $275,000 on $500k home |
* LTV (Loan-to-Value) ratios are approximate and may vary by lender, property location, and type.
Real Stories from Canadian Seniors
See how reverse mortgages have helped Canadians enjoy their retirement
Ages 72 & 74
Toronto, ON
"We wanted to help our granddaughter with university expenses without selling the home we've lived in for 40 years. A reverse mortgage gave us the funds we needed while letting us stay in our beloved home. It's been perfect for us."
Age 68
Vancouver, BC
"After retirement, I needed to make some accessibility renovations to my home. Rather than taking on debt I'd struggle to repay, a reverse mortgage provided the tax-free funds I needed. No monthly payments means I can live comfortably on my pension."
Age 76
Calgary, AB
"I used my reverse mortgage to pay off high-interest credit cards and supplement my retirement income. It's given me peace of mind and financial freedom in my golden years. I wish I'd known about this option sooner."
Compare Your Options
Understanding the differences between reverse mortgages and other home equity products
| Feature | Reverse Mortgage | HELOC | Home Equity Loan |
|---|---|---|---|
| Monthly Payments | None required | Required | Required |
| Age Requirement | 55+ | 18+ (with income) | 18+ (with income) |
| Credit Check | Not required | Required | Required |
| Income Verification | Not required | Required | Required |
| Interest Rates | 6-9% | Prime + 0.5-1% | 5-7% |
| Max Borrowing | Up to 55% of home value | Up to 65% of home value | Up to 80% of home value |
| Repayment | When you sell or move | Monthly minimum payments | Fixed monthly payments |
| Best For | Seniors with limited income | Those with stable income | One-time large expense |
Frequently Asked Questions
Get answers to common questions about reverse mortgages in Canada
Ready to Explore Your Options?
Our experienced mortgage specialists can help you determine if a reverse mortgage is right for you. Get personalized advice and explore all your options.
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