A reverse mortgage is a loan borrowed against the value of a property. For Canadian homeowners 55 or older, you may borrow back up to 55% of the equity invested in a property. Unlike traditional mortgages, no monthly payments are required. The money borrowed is tax-free and may be used at your discretion.
Factors under consideration during a reverse mortgage include:
- Age of all homeowners (Both you and your spouse must be 55 or older.)
- Age and condition of the property.
- Appraisal of house.
- Current equity level.
- Location of property.
When you obtain a reverse mortgage in Edmonton, the amount borrowed is due back when you move or sell the property.
Common Questions About Reverse Mortgages
Reverse mortgages have evolved from a needs-based product to a product that many financial planners highly recommend as an important component of a comprehensive retirement plan. However, at Alberta Mortgage, we hear plenty of misinformation about reverse mortgages in Edmonton. and we want to set the record straight. Below, commonly asked questions are answered, and myths are separated from the facts.
*Accurate as of December 2019. Some restrictions may apply.
Facts About Reverse Mortgage
When you apply for a reverse mortgage in Edmonton, there are a few things you should know. Such as:
- Reverse Mortgages are Tax-Free – This provides flexibility for retired seniors to stretch their savings further.
- You Control When the Loan is Repaid – Homeowners are never forced by the bank to repay a reverse mortgage in Edmonton if insurance is intact and property taxes are always paid.
- You Receive Your Loan on Your Terms – Reverse mortgage borrowers can choose to receive cash in a lump sum or partial monthly payments.
- There are no Monthly Payments to Make – There are no monthly payments on a reverse mortgage in Edmonton. Payment isn’t due until you move or sell.
How is a Reverse Mortgage in Edmonton Useful?
Homeowners use reverse mortgages in a variety of ways. Some pay off the remaining mortgage debt, while others use it to pay bills and retire comfortably. The way you spend your loan is entirely up to you. Some of the ways our clients use reverse mortgages include:
- Travelling with friends and family.
- Updating and renovating the home.
- Paying monthly bills and expenses.
- Paying off and restructuring other debts.
- Helping family in need.
If you’re interested in learning more about obtaining a reverse mortgage in Edmonton, contact Alberta Mortgage at 1-800-398-1891. Or fill out our online contact form here.