ReverseMortgage Burnaby,British Columbia

It is said that almost 8 in 10 Canadians that are over the age of 55 report saying that they can’t solely rely on their registered savings plans and pension plans to support an enjoyable retirement.

While home equity plays as a major income source to many in their retirement days, the thought of downsizing, moving, and starting over from your supposed to be forever home, for many isn’t ideal. That leaves homeowners with two options of equity take-out during their retirement days - a reverse mortgage or a home equity line of credit.

What is a Reverse Mortgage?

Simply put, if you are considered a senior homeowner, a reverse mortgage has the potential to unlock great value in your home without having to sell or move. To make things even sweeter, reverse mortgages turn a portion of your home equity into a source of cash resulting in you no longer having monthly payments.

Do you qualify?

• Applicants must be 55 and older.
• Applicants must reside in one of Canada’s major urban centers.
• Your home must be your principal residence and owner occupied.
• Applicants can show their ability to pay their annual property taxes, insurance, and applicable strata fees. *Alternative options may be available*.

Having close relationships with many of the most recognizable reverse mortgage lenders in Canada, we at Riley Boychuk Mortgages take great pride in understanding our client’s needs and goals before outlining mortgage options and facts upfront. This allows our clients to make their own educated decisions that they see best fits their financial goals.

We’re mortgage specialists, but were also real people and homeowner’s ourselves, so we understand the importance of working with someone you can trust. Schedule a call, make an appointment, or we can even come to you at a time that is most convenient for you.

7 Reverse Mortgage Myths

1. “You no longer own your own home once you secure a reverse mortgage”

This could not be further from the truth as you will maintain ownership of your home, including your title and having full control as you would with any first mortgage.

2. “In the end, you will exceed your home’s value and end up owing money”

This is also untrue as the products that we offer our clients at Riley Boychuk Mortgages, come with a No Negative Equity Guarantee! What this guarantee entails is that as long as the homeowner has met their obligations, the amount owing at the end will never exceed the home’s current fair market value. In fact, over 99% of our lender’s clients end up selling their home while retaining over 50% of the home’s value after the loan is paid back.

3. “62 years of age or younger can only qualify for a Reverse Mortgage”

While the Reverse Mortgage is available to all Canadian homeowners 55 and older, it is important to note that as you age, you will likely qualify for a greater loan amount. Within a reverse mortgage, as long as the home insurance and property taxes are in good standing, and the homeowner is occupying the livable space fulltime, the reverse mortgage option will remain a lifetime product even if the home’s value decreases in time.

4. “If you fail to make a mortgage payment, you will be evicted”

It’s important to remember that you maintain home ownership while remaining in full control of your home like you would with any first mortgage. The BONUS here is that in a reverse mortgage, you are NOT required to make any monthly payments, meaning you can’t ever miss a payment.

5. “Reverse Mortgages are expensive”

While this is untrue, securing a reverse mortgage is very similar to that of your standard conventional mortgage. Like any mortgage, you will be required to cover the appraisal fee as well as cost associated with independent legal advice. Where the remaining cost will be a one-off administrative fee, when comparing this to the costs of “right sizing”, you’ll notice the affordable and beneficial options behind reverse mortgages.

6. “Reverse Mortgages come with higher interest rates than conventional mortgages”

Yes, while this is generally true having a slightly higher interest rate with your reverse mortgage over traditional mortgages, the difference is not extreme. The benefits to that slightly higher interest rate are that you no longer have to make a monthly payment. Additionally, you won’t need to qualify for a traditional mortgage in the first place. When taking into effect a very modest and average market increase of 2% in your home’s annual value, a reverse mortgage might just be the answer for you.

7. “You can’t pass your home onto your children one day”

Again, this is untrue, as with any asset that you may have, your children will inherit your home as the beneficiaries as set forth by you. At this time, your children will have the option to keep the property or sell the property and pay down the mortgage. It is important to remember the No Negative Equity Guarantee clause that our lenders at Riley Boychuk Mortgages, state in all of our reverse mortgage products. This protects you and your beneficiaries for in the event that one day your mortgage exceeds your homes market value, as the lender will always cover the difference when the time comes that you choose to sell.

To learn more, contact us and one of our mortgage specialists will reach out to you for a stress free and no obligation discussion on what reverse mortgage options you may have today.