Reverse Mortgages

Thanks for connecting.

DON’T CHOOSE, COMPARE!! Before you make any decisions, we at Genesis Associates Ltd. will help you decide on the best Reverse Mortgage Lender based on your criteria. As brokers it is our function to educate you in making an informed decision.

As a brief disclosure there are primarily 2 bank lending institutions in Ontario offering the Reverse Mortgage product, HomeEquity Bank and Equitable Bank Inc. There is also Bloom Finance Company Ltd. Each of the 3 institutions have a varying portfolio of products associated with their reverse mortgages, so why not compare FIRST.

We have specifically created a secondary website that focuses solely on Reverse Mortgages.

Please click on this link and you will be directed to our Genesis Associates Ltd / Genesis Reverse Mortgages site.

Definition

A reverse mortgage is a loan that allows a you to get money from the equity in your home without having to sell. This is sometimes called “equity release”. You may be able to borrow up to a certain percentage of the current value of your home. The maximum amount you will be able to borrow will depend on your age, your home’s appraised value and your lender.

Eligibility

To be eligible for a reverse mortgage, the borrower(s) must be:

a homeowner (reside in a detached, semi-detached, condo or townhouse in Ontario)
principal residence (must reside in property for at least six months each calendar year)
at least 55 years of age (this applies to each borrower registered on the property)

If you have a spouse or partner and you are both on the title for your house, both of you must be listed on the reverse mortgage application. Both of you must be at least 55 years old to be eligible for a reverse mortgage. Further to this note, any additional people registered on title must be on the application and must be over 55 years of age.

Any existing mortgage financing, line of credit, lien or debt currently registered on your property must be paid off when you get a reverse mortgage. A reverse mortgage is NOT to be considered as additional financing to an existing mortgage.

Qualifying

When we apply for a reverse mortgage, the lender of choice will consider:

your age, and the age of your spouse/partner if they are registered on the title of your house
where you live
your home’s condition, type and appraised value

In general, the older you are and the more home equity you have when you apply for a reverse mortgage, the more money you could get. Current market trends will also impact how much money you could get.

It is our recommendation as brokers representing your best interest that you obtain Independent Legal Advice (ILA) before you get a reverse mortgage. ILA may be defined briefly as “retaining an arms length lawyer, who has no conflicting interest with respect to the client’s transaction, and the retained lawyer has explained the legal aspects of the transaction to you as the client, so that you understand the mortgage transaction given”.

Accessing your money with a reverse mortgage

You may be able to get the money from your loan by:

taking the money as a one-time lump sum
taking some of the money up front and taking the rest over time

You must first pay off and close any outstanding loans or lines of credit that are secured by your home, such as a mortgage or home equity line of credit. You could use the money you get from a reverse mortgage to do this.

You can use the remainder of the loan for anything you wish, such as to:

pay for home repairs or improvements
help with regular bills
cover healthcare expenses
repay debts

You will NOT be able to take out another loan secured by your home, such as a home equity line of credit, if you have a reverse mortgage.

Repaying the money borrowed with a reverse mortgage

You don’t need to make any regular payments on a reverse mortgage. You have the option to repay the principal and interest in full at any time. However, you may be charged a fee to pay off your reverse mortgage early.

Interest will be charged until the loan is paid off in full. The interest will be added to the original loan amount, which increases the loan amount over time.

If you sell your house or if you move out you’ll have to repay the entire amount left owing on the loan. You “may” also have to repay the entire amount owing on the loan if you default, depending on the circumstances and at the lenders discretion per your commitment.

You could default on a reverse mortgage by:

using the money from the reverse mortgage for anything that is illegal
being dishonest in your reverse mortgage application
letting your house fall into a state of disrepair that would lower how much it is worth
not following any conditions that you agreed to when getting your reverse mortgage

Costs to get a reverse mortgage

Costs associated with a reverse mortgage may include:

higher interest rate than for a traditional mortgage
a home appraisal fee
a setup fee
a prepayment penalty if you pay off your reverse mortgage before it is due
legal fees for closing costs or independent legal advice

The costs will vary depending on the lender, to which we will compare upfront. It is important to know what costs are associated with any mortgage, when they are due at any given point in time: ie when the mortgage first gets registered OR possibly at the end when the mortgage actually gets paid off and closed.

Definition

Eligibility

Qualifying

Accessing your money with a reverse mortgage

Call Us

Head Office

Email or Fax

Definition

Eligibility

Qualifying

Accessing your money with a reverse mortgage

Footer

Call Us

Head Office

Email or Fax