What Is A Reverse Mortgage?

NO. You retain full title, ownership, and control of your home as long as you meet your mortgage obligations, such as paying property taxes and maintaining the property. The reverse mortgage lender only holds a first mortgage on the title, similar to a traditional mortgage.

NO. A property appraisal and independent legal advice are mandatory for obtaining a reverse mortgage. Additional costs include a closing and administration fee. However, when compared to alternatives such as downsizing or relocating, a reverse mortgage can be a cost-effective option.

YES. Your heirs will always have the option to retain the property by paying off the reverse mortgage after your passing. Additionally, the "no negative equity guarantee" ensures that your heirs will never owe more than the home's fair market value, provided all mortgage obligations were met.

NO. Federal regulations require all reverse mortgages to include a "no negative equity guarantee." This means that as long as you fulfill your mortgage obligations, the amount you owe at the due date will never exceed your home's fair market value.

Depends. While interest rates for reverse mortgages are generally higher than those for traditional mortgages, many retired Canadians find them more accessible. Monthly payments can be challenging to manage on a fixed income, and qualifying for a traditional mortgage is often difficult. For these reasons, a reverse mortgage can be a more practical solution for many retirees.

Funds from a reverse mortgage can be used for anything, including debt consolidation, home renovations, living expenses, or travel. Often they're used to pay off existing mortgages or line of credit products that are no longer affordable.