In This Article What Is a Reverse Mortgage? How Much Can You Actually Get? Why a Reverse Mortgage Makes Sense When You're Equity-Rich but Income-Poor All 4 Canadian Reverse Mortgage Providers — Compared Quick Notes on Each The Complete Cost Breakdown Upfront Costs Cost Over Time — Real Example How a Reverse Mortgage Compares to Other Options Who Qualifies? 5 Common Ways Canadians Use Reverse Mortgage Funds What About Your Inheritance? Frequently Asked Questions What's the Right Move for You? Table of Contents You've worked hard, paid your mortgage for 20 or 30 years, and now your home is worth $600,000, $800,000, maybe more. But your monthly income tells a different story — CPP, OAS, maybe a modest pension that doesn't stretch as far as it used to. You're equity-rich and income-poor. And you're not alone. Nearly 1 in 3 Canadian seniors faces this exact gap between what they own and what they earn each month. A reverse mortgage bridges that gap — turning the wealth locked in your home into tax-free cash you can use today, without selling, moving, or making a single monthly payment. What Is a Reverse Mortgage? A reverse mortgage is a loan secured against your home's equity, available to Canadian homeowners aged 55 and older. Unlike a traditional mortgage where you make payments to the lender, a reverse mortgage pays you. The basics: Access up to 55% of your home's appraised value No monthly payments required — ever Funds are tax-free and don't affect OAS or GIS You keep full ownership and stay on title Loan is repaid only when you sell, move, or pass away Four providers now offer reverse mortgage or reverse-mortgage-style products in Canada: HomeEquity Bank (CHIP), Equitable Bank, Bloom Finance, and Fraction. How Much Can You Actually Get? The amount depends on four factors: Impact Your age Older borrowers qualify for more (55 minimum) Home value Higher value = higher borrowing limit Property location Urban properties typically qualify for more Property type Detached homes qualify for the most Real examples for a couple aged 70: Approximate Access (up to 55%) $400,000 $160,000 – $220,000 $600,000 $240,000 – $330,000 $800,000 $320,000 – $440,000 $1,000,000 $400,000 – $550,000 Why a Reverse Mortgage Makes Sense When You're Equity-Rich but Income-Poor This is the core scenario where a reverse mortgage truly shines. Consider Margaret, 72, in Burlington, Ontario: Home value: $750,000 (fully paid off) Monthly income: $2,400 (CPP + OAS + small pension) Monthly expenses: $3,100 — and climbing with 7.3% food inflation Monthly shortfall: $700 Margaret's options: 1. Sell and downsize — But she loves her home, her garden, her neighbourhood. 2. Get a HELOC — Requires income qualification she can't meet, plus monthly payments. And the bank can call it in with 60 days notice. 3. Reverse mortgage — Access $300,000+ with zero monthly payments, zero income requirements. Margaret chose the reverse mortgage. She receives $2,500/month in scheduled payments, supplementing her income without affecting her OAS or GIS benefits. With food and energy costs rising from the current geopolitical uncertainty, that supplemental income is more valuable than ever. All 4 Canadian Reverse Mortgage Providers — Compared The market has grown. You're no longer limited to one or two options. Here's how all four providers stack up as of March 2026: Variable Rate What Makes Them Different Equitable Bank Flex 6.54% (5-yr) 7.05% adj. Lowest posted rate in Canada right now HomeEquity Bank CHIP 6.64% (5-yr) 7.11% 30+ years in the business — the most recognized name Bloom Finance SafeRate™ ~6.74% – 8.29% Contact for rates Lifetime fixed rate that never resets — first in Canada Fraction Shared appreciation Varies N/A No age restriction, equity-sharing model instead of interest Quick Notes on Each Equitable Bank Flex currently has the lowest 5-year fixed rate at 6.54%. They also offer Flex PLUS (higher loan amounts at 7.69%) and Flex Lite options. Straightforward, competitive pricing. CHIP by HomeEquity Bank is the brand most Canadians know. They've been doing this for over 30 years. Their 5-year fixed sits at 6.64%, with CHIP Max at 8.24% for higher loan-to-value needs, and CHIP Open for maximum flexibility. Bloom Finance SafeRate™ launched in late 2025 and it's genuinely different. Your rate is fixed for life — not just 5 years. That means you're protected from future rate increases at renewal. Bloom also doesn't charge penalties for moving ("Right to Move") and offers compassionate repayment terms. Available in Ontario, BC, and Alberta. Fraction isn't a traditional reverse mortgage — it's a shared appreciation mortgage. You borrow with no monthly payments, but instead of paying interest you share a portion of your home's future value increase. No age restriction (you don't need to be 55+). The cost depends on how much your home appreciates, making it potentially cheaper in slow-growth markets. For a detailed cost breakdown of all four providers, read our complete costs and fees guide. The Complete Cost Breakdown Upfront Costs Amount Home appraisal $300 – $600 Independent legal advice $300 – $500 Administration/closing fee $1,495 – $1,795 Title insurance ~$250 Total upfront $2,345 – $3,145 Bloom Finance bundles fees differently: a flat $2,300 total (processing $1,650 + appraisal $350 + ILA $300), deducted from proceeds. Cost Over Time — Real Example $200,000 reverse mortgage at 6.64% (CHIP's current 5-year fixed rate): Total Interest Start $200,000 $0 Year 1 $213,280 $13,280 Year 5 $276,200 $76,200 Year 10 $381,300 $181,300 Year 15 $526,400 $326,400 Year 20 $726,600 $526,600 The context that matters: A $600,000 home growing at 3% annually is worth $1,083,700 in 20 years. Even after owing $726,600, you'd still have $357,100 in equity. Your home is growing alongside the loan. How a Reverse Mortgage Compares to Other Options Refinance Downsize Monthly payments ❌ None ✅ Required ✅ Required N/A Income qualification ❌ Not needed ✅ Required ✅ Required N/A Stay in your home ✅ Yes ✅ Yes ✅ Yes ❌ No Stress test ❌ No ✅ Yes ✅ Yes N/A Tax-free funds ✅ Yes ✅ Yes ✅ Yes Varies Interest rates 6.54% – 8.49% 5.95% – 6.70% 3.89% – 4.49% N/A Callable by lender ❌ No ✅ Yes ❌ No N/A For a deeper comparison, read our Reverse Mortgage vs. HELOC analysis. Who Qualifies? Requirements: You or your spouse is 55 years or older You own your home (primary residence) Your property has sufficient equity What's NOT required: ❌ Income verification ❌ Credit score minimum ❌ Stress test qualification ❌ Employment history Exception: Fraction's shared appreciation model has no age restriction — available to homeowners of any age. Learn more in our eligibility requirements guide. 5 Common Ways Canadians Use Reverse Mortgage Funds Supplement retirement income — Bridge the gap between pension/CPP and rising living costs (especially relevant now with 7.3% food inflation) Pay off existing debts — Eliminate HELOC payments, credit cards, or a remaining mortgage balance Fund home renovations — Aging-in-place modifications like accessible bathrooms, stairlifts, wider doorways Help family financially — Gift a down payment to children or grandchildren Cover healthcare costs — Private care, dental, prescriptions not covered by provincial health plans See real-world examples in our 5 real scenarios guide. What About Your Inheritance? A reverse mortgage does reduce the equity available to your heirs. But consider: You keep all remaining equity above the loan balance The no-negative-equity guarantee means heirs can never owe more than the home's value Home appreciation can offset much of the interest cost Your heirs have 180 days to repay the loan Read our detailed analysis: how a reverse mortgage affects your estate. What's the Right Move for You? With four providers, rising living costs, and genuine uncertainty in the bond market, there's no one-size-fits-all answer. Your age, your home's value and location, how long you plan to stay, your income, your family's expectations — it all factors in. The best starting point is a conversation. We'll walk you through what each provider offers for your specific situation, show you the real numbers, and help you decide whether now is the right time — or whether waiting makes more sense. No pressure, no sales pitch. Just straight answers. ← Back to all articles. Ready to Get Started? Contact us today for personalized mortgage advice and competitive rates. Get Pre-Approved Call (416) 822-7357 Frequently Asked Questions What Is a Reverse Mortgage? A reverse mortgage is a loan secured against your home's equity, available to Canadian homeowners aged 55 and older. Unlike a traditional mortgage where you make payments to the lender, a reverse mortgage pays you. Who Qualifies? Requirements: You or your spouse is 55 years or older You own your home (primary residence) Your property has sufficient equity What's NOT required: ❌ Income verification ❌ Credit score minimum ❌ Stress test qualification ❌ Employment history Exception: Fraction's shared appreciation model has no age restriction — available to homeowners of any age. Learn more in our eligibility requirements guide. What About Your Inheritance? A reverse mortgage does reduce the equity available to your heirs. But consider: You keep all remaining equity above the loan balance The no-negative-equity guarantee means heirs can never owe more than the home's value Home appreciation can offset much of the interest cost Your heirs have 180 days to repay the loan Read our detailed analysis: how a reverse mortgage affects your estate. What's the Right Move for You? With four providers, rising living costs, and genuine uncertainty in the bond market, there's no one-size-fits-all answer. Your age, your home's value and location, how long you plan to stay, your income, your family's expectations — it all factors in. The best starting point is a conversation. We'll walk you through what each provider offers for your specific situation, show you the real numbers, and help you decide whether now is the right time — or whether waiting makes more sense.
