Is a Reverse Mortgage Right for you?

Carola Singer • November 14, 2018

One of the benefits of working with a Canadian Mortgage Expert is that we aren’t tied to a single lender, rather we have access to multiple lending institutions. Having more options with lender partners, means having more options with mortgage products. The HomeEquity Bank and their reverse mortgage product is a great example of this.

A reverse mortgage allows Canadian homeowners 55 and older to access some of the equity in their home without any income or credit checks, and no monthly payments.

The HomeEquity Bank recently conducted some research in partnership with IPSOS research and discovered what older Canadians really want from their retirement, they included the information in a newsletter, and we wanted to share the findings with you here…

These are the key points:

> 93% of 65+ Canadians want to continue living in their home throughout retirement
> Almost 70% want to stay so that they can maintain their independence
> Many have been approached about selling their home but are determined to stay

They also need extra money. In the same survey, HomeEquity Bank asked: if money were no object, what improvements would you make to your home?

> 33% said that they would modernize their home’s décor
> 40% would install a new kitchen or bathroom
> 21% would install accessibility enhancements

In an earlier survey carried out with ResearchNow, HomeEquity Bank asked Canadian homeowners aged 55+, if they were given a $100k cash gift, what would they do with the money? Their answers included paying off their mortgage or other loans, using it to supplement retirement income or covering healthcare expenses.

So why do they need help to stay in their home? Many Canadians approaching retirement age have insufficient or zero retirement savings. Plus, retirees are seeing their debt grow faster than any other age group.

If you or someone you know might benefit from talking about a reverse mortgage, any one of our Canadian Mortgage Experts would love to discuss all your financial options.

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When you’re buying a home, two terms often cause confusion: deposit and down payment . While they’re related, they serve very different purposes in the homebuying process. Here’s what you need to know. What Is a Deposit? A deposit is the money you provide when you make an offer on a property. Think of it as a show of good faith that proves you’re serious about purchasing. How it works : Typically, you provide a certified cheque or bank draft that your real estate brokerage holds in trust. If your offer is accepted, the deposit remains in trust until the deal moves forward. If negotiations fall through, the deposit is refunded. Connection to your down payment : Once the sale is finalized, your deposit becomes part of your total down payment. Why it matters : The amount is negotiable, but a larger deposit can make your offer more attractive in a competitive market. Keep in mind, however, that if you back out after conditions are removed, you risk losing your deposit. What Is a Down Payment? Your down payment is the amount you contribute toward the purchase price of your home when securing a mortgage. Minimum requirement : In Canada, the minimum down payment is 5% of the home’s purchase price. Anything less than 20% requires mortgage default insurance. Sources : Down payments can come from your savings, the sale of another property, RRSP withdrawals (through the Home Buyers’ Plan), a gift from family, or even borrowed funds. Example: How They Work Together Imagine you’re buying a $400,000 home with a 10% down payment ($40,000). When you make your offer, you provide a $10,000 deposit . Once conditions are met, that deposit is transferred to your lawyer’s trust account. At closing, you add the remaining $30,000 to complete your full down payment. The lender provides the rest—$360,000—through your mortgage. The Bottom Line Your deposit shows commitment and secures your offer, while your down payment is what makes the mortgage possible. Together, they work hand in hand to get you into your new home. 📞 If you’d like clarity on deposits, down payments, or any other part of the mortgage process, let’s connect. I’d be happy to walk you through it step by step.