Government Benefit Affects

I'm often asked how Government benefits will be affected by a reverse mortgages. In this article I touch on the most common government benefits and affects when a reverse mortgage is in place.

Introduction

A key advantage of reverse mortgages is that the funds aren’t treated as income, so they typically don’t impact government benefits. See below for each Government Benefit and their affects from a reverse mortgage.
 

Affects on Government Benefits?

Old Age Security (OAS)
Your OAS pension is unaffected because reverse mortgage funds aren’t classified as income.

Guaranteed Income Supplement (GIS)
GIS payments, which are income-tested, won’t be affected by reverse mortgage funds since they don’t count as income.

Canada Pension Plan (CPP)
CPP benefits are based on your earnings history and contributions, so reverse mortgages have no impact.

Provincial Assistance Programs
While reverse mortgage funds don’t usually affect provincial assistance benefits, homeownership might. Check with your provincial agency to confirm.

Property Tax Rebates
Programs for seniors and low-income individuals are typically unaffected by reverse mortgage funds, but it’s wise to verify with local administrators.

Conclusion

Reverse mortgages are a reliable way to boost finances without compromising government benefits. For tailored advice, consult a financial advisor or benefits specialist.