Brokers have their criticisms of reverse mortgages but one of the leading providers of these mortgage products wants to dispel one of the most popular arguments.
Brokers have their criticisms of reverse mortgages but one of the leading providers of these mortgage products wants to dispel one of the most popular arguments.
“After 28 years -- and through one of the worst financial crises we’ve seen in Canada -- in most cases at the time of sale our clients have an average of 50 per cent of the equity left in their homes,” Jeff Spencer, VP of National Sales for HomEquity Bank says in an official release.
According to CARP, a national not-for-profit organization committed to a “new vision of aging for Canada,” 12 million working Canadians (two-thirds of the workforce) do not have workplace pension plans and RRSPs have “not been the answer” to retirement security.
“Canadian seniors want to remain in their homes as they age,” Spencer said. “However, there are many that could lose their homes because they haven’t saved enough for retirement, some will be forced out due to a lack of information on options and many of them have the answer in front of them and don’t know it.”
Spencer believes the solution is a reverse mortgage, such as the CHIP reverse mortgage his HomeEquity Bank offers.
“Many baby boomers have not saved enough money for retirement. Without jobs and income, many face dire financial worries. In many cases, ‘sell the home’ is a knee jerk reaction,” Spencer said. “We want to educate Canadians on other options, including the reverse mortgage.”
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Still, many brokers are wary.
“I can understand why many homeowners would be attracted to this type of finance as it’s a fixed rate compared to a HELOC, and it’s a way of getting cash quickly if you are going through a financial patch, but it’s not ideal, especially if you want to sell in the future,” Marc Abramovitz from Northwood Mortgage and founder of ilovemymortgage.ca said in early April. “There are a lot of other options available and homeowners really need to do a lot of due diligence and get independent advice before signing up for (reverse mortgages).”
And while reverse mortgages have been available since the introduction of the Canadian Home Income Plan in the mid-1980s, very few financial lenders have openly offered the product. However, with an aging population and dependent children needing help with down payments, there has been a report of rising interest in this financial method.
“I am seeing a lot more use and interest in reverse mortgages, especially for those who are in difficult situations,” Abramovitz said. “For example, one my clients had no mortgage on her home, and needed cash to reinvest back in her house. Her only other was to sell the property so a reverse mortgage was the best solution.”
“After 28 years -- and through one of the worst financial crises we’ve seen in Canada -- in most cases at the time of sale our clients have an average of 50 per cent of the equity left in their homes,” Jeff Spencer, VP of National Sales for HomEquity Bank says in an official release.
According to CARP, a national not-for-profit organization committed to a “new vision of aging for Canada,” 12 million working Canadians (two-thirds of the workforce) do not have workplace pension plans and RRSPs have “not been the answer” to retirement security.
“Canadian seniors want to remain in their homes as they age,” Spencer said. “However, there are many that could lose their homes because they haven’t saved enough for retirement, some will be forced out due to a lack of information on options and many of them have the answer in front of them and don’t know it.”
Spencer believes the solution is a reverse mortgage, such as the CHIP reverse mortgage his HomeEquity Bank offers.
“Many baby boomers have not saved enough money for retirement. Without jobs and income, many face dire financial worries. In many cases, ‘sell the home’ is a knee jerk reaction,” Spencer said. “We want to educate Canadians on other options, including the reverse mortgage.”
(Continued)
#pb#
Still, many brokers are wary.
“I can understand why many homeowners would be attracted to this type of finance as it’s a fixed rate compared to a HELOC, and it’s a way of getting cash quickly if you are going through a financial patch, but it’s not ideal, especially if you want to sell in the future,” Marc Abramovitz from Northwood Mortgage and founder of ilovemymortgage.ca said in early April. “There are a lot of other options available and homeowners really need to do a lot of due diligence and get independent advice before signing up for (reverse mortgages).”
And while reverse mortgages have been available since the introduction of the Canadian Home Income Plan in the mid-1980s, very few financial lenders have openly offered the product. However, with an aging population and dependent children needing help with down payments, there has been a report of rising interest in this financial method.
“I am seeing a lot more use and interest in reverse mortgages, especially for those who are in difficult situations,” Abramovitz said. “For example, one my clients had no mortgage on her home, and needed cash to reinvest back in her house. Her only other was to sell the property so a reverse mortgage was the best solution.”
