In Canada there is currently only one provider of reverse mortgages. HomEquity Bank is a Canadian Charted Bank. The company offers two options that allow senior to access the equity in their home.
CHIP is a reverse mortgage, a loan secured against the value of your home. Unlike a loan or a regular mortgage, with CHIP you are not required to make payments. You only repay the loan when you move or sell your home.
You are required to keep your property in good maintenance, pay your property taxes and property insurance.
The money you receive is tax-free and yours to use as you wish.
This product allows you to access up to 55% of the value of your home and is generally used if you need to draw the money out right away.
Income Advantage from HomEquity Bank is a loan secured against the value in your home. It lets you convert part of your home equity into cash – without requiring you to sell or move. Income Advantage gives you choice and flexibility.
You maintain complete ownership and control of your home. You can access your money in monthly installments or initial and periodic advances. Income Advantage lets you access up to 55% of your home’s appraised value and you receive the money tax-free.
This product is a better match if you are looking to provide a monthly income.