According to a recent study by Angus Reid, 7 in 10 Canadians say money is a source of stress*. The current rising inflation makes Canadian families more challenging to maintain their standard of living. Also, Canadians are becoming stressed about rising inflation, increasing expenses, and home retrofitting costs to higher grocery and electricity bills.
At times like this, you might be looking for advice and guidance on how you can navigate the uncertain economic climate to maintain your standard of living. The Reverse Mortgage is a solution today for Canadians who are 55 years old and over.
Here are FIVE benefits of the Reverse Mortgage:
1. A Reverse Mortgage allows you to leverage your most valuable asset – your home. You could access up to 55% of the equity in your home, tax-free, with no required monthly mortgage payments, and no negative impact on your cash flow.
2. A survey found that 92% of Canadians 45+ are keen on aging in place, but finances are a barrier**. With a Reverse Mortgage, you can stay in the home and community you love. You can release more equity in the future, if you choose not to take the total amount or if the value of your home rises. Additionally, you will still be able to benefit from future home price appreciation.
3. With a Reverse Mortgage, there is no restriction on how you spend the money you receive. You can use a Reverse Mortgage to relieve financial pressure, increase your cash flow, buy the vacation property you always dreamed of, cover health care expenses, or renovate or make home improvements to your current home.
4. Because you are tapping into your home equity, the funds are not added to your taxable income, nor do they affect government benefits such as Old Age Security (OAS) and Canada Pension Plan (CPP). Also, unlocking part of your home’s equity allows a more significant portion of your registered investments to continue growing on a tax-free basis – potentially providing more assets to leave your heirs.
5. Some banks offer No Negative Equity Guarantee, meaning you will never owe more than your home is worth when you decide to move or sell. This feature ensures that if your home depreciates below the mortgage amount owing, the bank will cover the difference***. You can stay in the home you love while you wait for the housing market to recover. As an added protection, the bank’s process includes independent legal advice for your lawyer to review the mortgage contract to ensure you understand all the features of the contract.
Are you looking for a reverse mortgage? Contact me to find out how the Reverse Mortgage can be a viable option to help you live your best retirement.
**Survey Methodology: A survey conducted by Ipsos, on behalf of HomeEquity Bank from April 13-16, 2022, polled 1001 Canadians 45+ to assess public opinion on the role and contributions of Personal Support Workers and financial barriers to access.
***As long as you keep your property in good maintenance, pay your property taxes and property insurance and your property is not in default. The guarantee excludes administrative expenses and interest that have accumulated after the due date.