Frequently Asked Questions

For Reverse Mortgage Counseling please give us a call at 1-866-758-2447 and we can walk you through any of your questions or concerns. Our Reverse Mortgage Professionals are available weekdays from 8:30AM to 5:00 PM (EST) to answer any questions you may have.

For detailed information about Reverse Mortgages, download our FREE information guide.

CHIP Reverse Mortgages are available in all Canadian provinces including:

• Ontario
• Quebec
• British Columbia
• Alberta
• Nova Scotia
• Saskatchewan
• Manitoba
• New Brunswick
• Newfoundland and Labrador
• Prince Edward Island

CHIP Reverse Mortgages are not available in the Territories:

• Northwest Territory
• Yukon Territory
• Nunavut

CHIP Reverse Mortgage is offered by HomeEquity Bank, a Schedule 1 Canadian Bank and as such, is member of the Canadian Bankers Association. HomeEquity Bank is heavily regulated by the Federal Bank Act. The CHIP Reverse Mortgage is CARP (Canadian Association for Retired Persons) recommended and endorsed by the The Royal Canadian Legion.

Reverse Mortgage funds are yours to use however you wish. CHIP Reverse Mortgages are often used to pay off debt, health care related costs, house renovations, income supplements, living expenses, and travel. If you have an existing mortgage or loans secured against your home, the proceeds of the Reverse Mortgage must first be used to pay-off these debts, then the remaining funds can be used for whatever you like!

Check out our blog for more information on how our current clients are using reverse mortgage funds.

Funding options for your Reverse Mortgage include receiving the proceeds of your Mortgage as a one-time lump sum payment or receiving scheduled payments over time to supplement your retirement income. These payment methods can also be combined to receive both as funds up front at time of closing and the rest in incremental scheduled payments.

More details about the Chip Reverse Mortgage Payment Options can be found in our blog.

We love sharing our customer stories, check out our customer stories and reviews from our customer testimonials page. Check it out to see what makes CHIP the best Reverse Mortgage loan in Canada!

CHIP Reverse Mortgage interest rates are available in both fixed and variable terms. The variable rate will fluctuate as it is directly influenced by the Bank of Canada’s prime rate. If the Bank of Canada’s prime rate increases, for example, your Reverse Mortgage interest rate will also increase. Our fixed rates are set for a pre-determined timeframe and are available for a six-month, 1-year, 3-year or 5-year period.

The closing fee charged by HomeEquity Bank for most clients is $1795 although individual circumstances do vary. The closing fee is deducted from the proceeds of the mortgage instead of being paid out of pocket. The closing fee covers legal, administrative costs, discharging any prior mortgage and registration of the CHIP Reverse Mortgage.

Learn More about CHIP’s Fixed and Variable Reverse Mortgage Interest Rates.

In addition to the interest charged on the money borrowed, a Reverse Mortgage will typically involve paying the following nominal fees:

• Appraisal Fee: paid to an external property appraiser
• Independent Legal Advice: paid to a lawyer/notary of your choice for independent legal advice
• Closing Cost: fee collected by HomeEquity Bank, financed through the proceeds of the Reverse Mortgage

For complete details about the costs of Reverse Mortgages please read our blog.

If your home depreciates in value and the Mortgage amount due is more than the sale price, HomeEquity Bank will cover the difference between the sale price and the Mortgage amount as long as you have met your obligations under the mortgage, including paying your property taxes, maintaining your property and paying your home insurance. This is HomeEquity Bank’s Negative Equity Guarantee. Our conservative lending practices ensure that you will never owe more than the fair market value of your home. In most cases, your home will appreciate in value. In fact, 99% of clients have money left over when their Mortgage is repaid.

Check out our full guide on selling a house with a Reverse Mortgage.

With a Reverse Mortgage, you remain as the owner and the bank never takes ownership of your home, provided you have met your mortgage obligations*. Your Mortgage only becomes due when you sell your home, move out of your home or eventually pass away. The CHIP Reverse Mortgage is a non-recourse loan, meaning that the borrower will never owe more than the home is worth. Your obligation is to ensure that you are paying your property taxes, home insurance and that your property is well maintained.

*Obligations include paying your property taxes, maintaining your property and paying your home insurance.

Any appreciation on the value of your home goes right back into your pocket. With a Reverse Mortgage, you only pay interest on the amount borrowed, not the appreciation on the home.

Watch this video to learn more about how your reverse mortgage would affect your home equity.

When the borrower(s) pass away, the heirs will be responsible for repayment of the Reverse Mortgage. Typically, the heirs would make the choice to sell the property in order to repay the Reverse Mortgage amount.

In the event you pass away before taking out your Reverse Mortgage in its entirety, your heirs will only be liable to repay the amount of the loan (and the interest accrued) on that portion of the Reverse Mortgage.

The Reverse Mortgage only becomes due once you move, sell the house or eventually pass away. If you are living in your home, HomeEquity Bank will not approach you for payments. Once the Reverse Mortgage becomes due, the total amount of the Mortgage plus interest would be due. This is typically covered by equity of the home and in most cases (99% of our clients), the sale of the house ends up covering the cost of the Mortgage plus leaving money left over.

As a Reverse Mortgage is considered tax-free income, it will not affect Medicare or pension benefits. Because of this, the Reverse Mortgage is a terrific way to supplement post retirement income when your pension and Retirement Savings Plan (RSP) may not be enough to cover your expenses.

Several factors determine how much money you can qualify for with a Reverse Mortgage. The following factors determine the amount you can borrow; all borrowers must be 55 years or older a (older usually means you would qualify for more), location, and the appraised value of the home. All factors considered, the maximum amount you may qualify for is up to 55% of the value of the home.

For more information and to see what your Reverse Mortgage can be worth, try our Reverse Mortgage Calculator.

A Reverse Mortgage can be taken out on a variety of home types, for example: condos, apartments and semi-detached homes.

You will always maintain complete ownership of your home! When completing a Reverse Mortgage with CHIP you maintain complete ownership of your home and we will never force you to move from your home.

Check out our blog if you are still wondering Do I still own my house if I get a Reverse Mortgage?

As a Reverse Mortgage borrower, you will have a few responsibilities:

• maintain basic home repairs
• pay all property taxes
• pay the home insurance

If applicable, the homeowner is also responsible for Condo Fees.
For more information on the responsibilities of a Reverse Mortgage borrower call us at 1-866-758-2447.

As part of our review of your application, we do request your consent to obtain a credit bureau. Your credit bureau is reviewed and is part of your decision process.

If you are approved for a Reverse Mortgage you will be required to prepared and send the following documents. Note that individual circumstances vary and this is not intended to be a comprehensive list.

• 2 forms of identification
• Verification that the property is your principal address
• Signed application
• Required legal documents
• Property Insurance information
• Statement(s) on any existing mortgage (if applicable)
• Proof that property taxes are up to date

Your property must have an appraised value of at least $250,000 in order for you to be eligible for a CHIP Reverse Mortgage. The appraised value of your home is only one element in determining whether you are eligible and how much you qualify for. The other important factors are your age, the age of your spouse and the location of your home. Minimum advance amount is $25, 000.

Try out our Reverse Mortgage Calculator to see how much you may qualify for!