Want to know the plain truth about getting a reverse mortgage in Brampton? You have come to the right place! Although Canadians have had access to reverse mortgages for over 25 years, there are still many common misconceptions about them! To help you get the right facts, we have put together some information on reverse mortgages below.

A Reverse Mortgage Is A Type Of Loan

First things first. A reverse mortgage is a type of loan that homeowners aged 55 or older can access, and the borrowing amount is based on factors such as your age and the value of your home rather than traditional factors such as credit score. Unlike a regular loan, reverse mortgages do not require the borrower to make any monthly payments until they choose to move or sell their home. While you can make payments if you want, you are not under any pressure to do so as there are safety precautions in place in the event of a death or necessary move to a care facility. Reverse mortgages have comparable interest rates to other home equity loans, but have slightly higher rates than a home equity line of credit because of the ability to opt out of monthly payments.

Paying Off The Loan

Once you decide to move or sell your home, your reverse mortgage loan will be paid off using the money made from the sale. Once the loan is paid in full, the remaining money belongs to the homeowner. On average, homeowners retain well over 50% of the value of the home after repaying their reverse mortgage loan. This means that Brampton homeowners will likely be able to retain a very healthy amount of money even after their loan is repaid.  

Another great thing about a reverse mortgage product is that you will never be forced to move or sell your home. You will always maintain control of your home, and as stated above, there are certain protections in place for extraneous circumstances. If the sole borrower passes away before repayment of the loan, the loan will be repaid from the sale of the home by the estate. The remaining money will belong to the estate or any heirs.

Questions about reverse mortgages? Ready to get your own reverse mortgage product? Give me a call today! Now that you know the truth about reverse mortgages, you can be confident in your decision to unlock your home equity.