You don’t actually lose your home

Most common among retirees, a reverse mortgage is mostly used for paying off debt, making renovations or financing health expenses. Since there isn’t an obligation to make regular payments with this type of mortgage, a reverse mortgage is often the go-to solution for many Canadians. Even though they’re not new in Canada and are, in fact, highly regulated, there still are some misconceptions regarding reverse mortgages we will explain in this article.

You can’t apply if you’re younger than 62

In Canada, reverse mortgages are available for homeowners who are at least 55 years old. However, the older a homeowner is – the more money they qualify for.


Getting evicted if no payments are made is one of the biggest fears and myths out there. With a reverse mortgage, there aren’t any regular payment obligations, therefore a payment can’t be missed.

Losing ownership

Just like with a regular mortgage, the homeowner has full control of their home. The bank cannot force anyone to sell their home and a person is allowed to live there as long as they wish. The only obligation is keeping the property well-maintained and paying property tax and insurance.

The heirs lose the property

If someone inherited the property under a reverse mortgage, they have the opportunity to pay off the reverse mortgage of the person they inherited it from.

Owing more than the property is worth

As long as the property is in good condition and the property tax is paid, homeowners will never owe more than they should. Coming back to heirs, after the property is sold and the mortgage paid off, they usually end up with more money left.

The spouse has to move out in case of death

The surviving spouse is not forced to move out. There are no obligations to move out or to make payments until they move or sell their home.

It’s expensive to arrange

Like with any other conventional mortgage, there has to be a payment for an appraisal of the property. The other cost is the closing fee.

Interest rates are higher than usual

This one is not technically a lie. Since this type of mortgage is not a traditional one, the interest rates can be a bit higher – because there are no monthly payments.  Based on their income, a lot of retirees in Canada cannot afford regular monthly payments and therefore cannot apply for a conventional mortgage – so they opt for the one with no monthly payments.

We can help

No one wants to get into something they know nothing about. Before you decide what type of mortgage would suit you best, be sure to do your research first.  If you’re thinking about going for a reverse mortgage but aren’t sure how much it would cost you, try using our online mortgage calculator. Our team is dedicated to changing your financial future and can help you find out what you need. Call us on 1-855-695-9250!