Reverse Mortgage Myths

Let’s separate the Myths from the Facts.

Myth #4

A Home Equity Line of Credit (HELOC) is a better option

The Facts:

HELOCs are a good short term borrowing option for people who can pay the interest and loan in the near future. However, HELOCs are callable loans with monthly payments and there exists a significant risk of non-renewal or cancellation.
In comparison, a Reverse Mortgage is a long term financial solution that won’t be called based on economic changes such as interest rates increasing, property values decreasing, or a change in the homeowner’s income. Also, money from a Reverse Mortgage provides the ability to prolong retirement savings.

Myth #5

Those with a Reverse Mortgage will owe more than their house is worth

The Facts:

A Reverse Mortgage is approved based on conservative lending practices and will only allow clients to take a maximum of 55% of the home’s appraised value. In fact, 99% of Reverse Mortgage holders have equity remaining in the home when the loan is repaid. The average client still has 50% of their equity when they sell.

HomEquity Bank and Equitable Bank are the only two providers of the CHIP Reverse Mortgage, they are both federally regulated Schedule 1 Canadian Banks and both provide reverse mortgages in Canada for homeowners 55 and over. They are dedicated to exclusively servicing seniors and providing seniors with a mortgage solution that is flexible, and affordable.

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