Equitable Bank launches PATH Home Plan

Equitable Bank, a subsidiary of Equitable Group Inc., announced today the launch of its PATH Home Plan, an equity release solution that gives Canadian homeowners, aged 55 and over, a new option to unlock the equity in their homes.

With continued retirement income uncertainty amongst a growing population of aging Canadians, the PATH Home Plan provides a solution to maintain their financial security.

“Canadians deserve options when it comes to their financial well-being as they age, and we want to help homeowners stay in control, while still living in their homes,” says Kim Kukulowicz, Vice President of Residential Sales and Partner Relations, Equitable Bank. “The PATH Home Plan allows homeowners to access the equity out of their greatest asset – their home – to continue enjoying life’s precious moments and to maintain the lifestyle that they are accustomed to.”

Equitable Bank’s PATH Home Plan will initially be available to homeowners in AlbertaBritish Columbia and Ontariothrough mortgage brokers.

“For a long time, Canadians have had limited choices to access the equity in their homes,” says Kukulowicz. “Now, they can sit down with an experienced and well-established mortgage broker network, and get the right guidance and personalized options that meet their needs.”

Equity release solutions, also known as reverse mortgages, are widely used in other countries, such as the United KingdomAustralia and the United States, and with a rapidly-growing senior segment in Canada, Equitable Bank believes that it can help more Canadian homeowners maintain their financial security, while staying in their homes.

Consistent with Equitable Bank’s strategic vision of being Canada’s Challenger Bank™, the PATH Home Plan will continue to diversify the business, while helping more Canadians reach their financial goals. “We have been studying the equity release market with interest for several years,” says Andrew Moor, President and Chief Executive Officer, Equitable Bank. “With the combination of favourable demographics, increased home equity values and less support from traditional defined benefit pension plans, we believe that the PATH Home Plan will provide a valuable option to Canadian seniors, generate attractive returns for our shareholders, and further strengthen our business.”

Visit www.equitablebank.ca/path to learn more and speak with a mortgage broker to assess if the PATH Home Plan is the right solution for you.

About Equitable Group Inc.
Equitable Group Inc. is a growing Canadian financial services business that operates through its wholly-owned subsidiary, Equitable Bank. Equitable Bank, Canada’s Challenger Bank™, is Canada’s ninth largest independent Schedule I bank and offers a diverse suite of residential lending, commercial lending and savings solutions to Canadians. Through its proven branchless approach and customer service focus, Equitable Bank has grown to almost $23 billion of Assets Under Management. EQ Bank, the digital banking arm of Equitable Bank, provides state-of-the-art digital banking services to more than 43,000 Canadians. Equitable Bank employs nearly 600 dedicated professionals across the country, and is a 2018 recipient of Canada’s Best Employer Platinum Award, the highest bestowed by AON. For more information about Equitable Bank and its products, please visit EquitableBank.ca.

SOURCE Equitable Bank

HomEquity Bank Posts Record 2017 Growth in Reverse Mortgages

HomEquity Bank, the national provider of the CHIP Reverse Mortgage™, posted record mortgage growth in 2017 with 32.5 per cent year over year growth. Reverse mortgage originations of $608MM for 2017 were driven by increased consumer familiarity with HomEquity Bank’s flagship product as well as the growing need for consumers to finance their retirement in new ways.

HomEquity Bank’s record results also reflect a strong partnership with Canada’s mortgage brokers. In 2017, brokers were the bank’s fastest growing referral source increasing by 55 per cent. HomEquity Bank also doubled the number of consumer product inquiries that came in through their website and call centers.

“The sustained strength of Canada’s real estate market has increased the confidence of Canadian homeowners in reverse mortgages,” said Steven Ranson, HomEquity Bank’s president and CEO.  “That means proactive equity release is a more attractive solution than ever for Canadians planning for retirement.”

“2017 was an exceptional year for our bank and for our clients,” Ranson added. “As the Canadian population continues to age, there is clear demand among Canadians aged 55 and older, to unlock the equity they’ve accrued in their homes. We are continuing to change the conversation about how reverse mortgages fit into Canadians’ comprehensive retirement plans and have a positive outlook for continued, long-term growth in 2018 and beyond.”

About HomEquity Bank

HomEquity Bank, a federally-regulated, Schedule 1 Canadian bank, is the only national provider of the CHIP Reverse Mortgage™ solution. Founded 30 years ago, HomEquity Bank has been helping Canadian homeowners aged 55+ access the value of the equity they have in their homes, maintaining ownership of their home, until they make the decision to sell.

HomEquity Bank has partnered with the Canadian Association of Retired Persons (CARP) Canada’s largest non-profit, non-partisan advocacy association for Canadians As We Age. CARP now recommends HomEquity Bank’s CHIP Reverse Mortgage™ as a smart and comprehensive solution for Canadians planning for retirement.

HomEquity Bank has ranked on the Canadian Business and PROFIT’s 28th and 29th annual PROFIT 500 list, the definitive ranking of Canada’s Fastest-Growing Companies.

HomEquity has also been recognized as an Aon Best Employer – Canada 2017.

SOURCE HomEquity Bank

FutureShare Helps Canadians Unlock Their Real Estate Wealth

Fintech Platform FutureShare Launches to Help Canadian Homeowners Unlock Their Real Estate Wealth

Alternative to HELOCs and reverse mortgages means homeowners don’t have to sell to tap into their home equity

There is more than $2.9 trillion in unmortgaged real estate equity in Canada (CREA), and today fintech platform futureshare launches to help Canadians unlock that real estate wealth without taking on new debt. The company was founded in 2016 as an alternative to home equity loans, home equity lines of credit (HELOCs) and reverse mortgages and gives homeowners a lump sum free of ongoing payments and interest rates in exchange for a percentage of the home’s appreciation, which can be paid out without penalty at any time or once the property is sold. futureshare’s online platform is the first of its kind in Canada and is now live in beta and accepting online applications for homes within Ontario with plans to launch in Alberta, Manitoba and British Columbia by the end of 2017.

“Canada’s housing market has billions in untapped equity and futureshare is giving that wealth back to Canadians to help them reduce financial stress and live happier lives. We’re revolutionizing the process by giving Canadians an alternative to home equity loans or HELOCs that’s interest rate and payment free, allowing them to unlock their real estate wealth and increase their cash flow,” said Michael Orrbrooke, CEO and founder of futureshare. “Whether it is, for example, for home improvements, debt consolidation, for funding retirement or investing in a small business, futureshare wants to help Canadians achieve their financial goals without adding new debt.”

The average Canadian owes $1.67 for every dollar in income (StatsCan), and futureshare is designed to help homeowners access the equity tied up in their home without adding to their ongoing debt burden. Unlike a reverse mortgage or HELOC, futureshare doesn’t require homeowners to have perfect credit scores or to fall within a specific income bracket, and it doesn’t increase monthly payments. A homeowner’s eligibility is based primarily on their home value and whether they have at least 25 per cent equity ownership in their home. Homeowners will be able to access on average up to 10-20 per cent of their home equity using futureshare’s platform, and unlike a loan, there’s no ongoing payments or interest rates.

Canada has become a hub for fintech innovation, with venture capital financing for fintech companies increasing by 74% from 2015 to 2016 (Thomson Reuters). Like other fintech platforms, futureshare’s process is simple and easy to complete online. Homeowners can use the online equity release calculator to see how much of their wealth they can unlock, and once they complete the 90 second pre-qualification questions, the homeowner receives a real-time conditional offer outlining the details of the equity release amount and terms they could receive. The home is then appraised and a final offer is sent via email by futureshare to the homeowner, with the credit application and underwriting process continuing online. Homeowners receive their funds, via electronic transfer, on average within 10-15 business days of signing the final offer.

Homeowners can use futureshare’s free qualification tool here to find out if they qualify in two minutes or less.

To learn more about futureshare, visit futureshare.ca.

Social media links:

Facebook: facebook.com/futuresharedf
Twitter: twitter.com/futuresharedf

About futureshare

futureshare provides an alternative to home equity loans, home equity lines of credit (HELOCs) and reverse mortgages, helping homeowners unlock their real estate wealth without having to sell their home. The online platform provides consumers with the opportunity to receive funds based on an appraisal on their home in exchange for a portion of their homes future appreciation, meaning that homeowners have zero ongoing payments, and incur zero interest. futureshare is currently available in beta in Ontario with plans to launch in Manitoba, Alberta and British Columbia by the end of 2017. futureshare is based in Toronto, and the platform launched in May 2017.

CONTACT INFORMATION

HomEquity Bank on the 2016 PROFIT 500

chip reverse mortgageCanadian Business and PROFIT today placed HomEquity Bank on the 28th annual PROFIT 500, the definitive ranking of Canada’s Fastest-Growing Companies. Published in the October issue of Canadian Business and at PROFITguide.com, the PROFIT 500 ranks Canadian businesses by their five-year revenue growth.

HomEquity Bank, the only national provider of reverse mortgages in Canada, placed 475 on the 2016 PROFIT 500 list, thanks to a five-year revenue growth of 80%. The company’s total revenues and number of employees have soared, while assets under management have climbed to $2.2 billion.

Celebrating 30 years in business, the company is in significant growth mode and leveraging product and channel innovation to sustain increases in total revenue. By reaching seniors via digital channels such as social media, as well as partnering with banks to extend reach, HomEquity Bank has addressed the changing needs of today’s older Canadians. In fact, 80% of HomEquity Bank’s direct-to-consumer leads are obtained online.

Canadian seniors obtain reverse mortgages from HomEquity to: address retirement planning; enhance lifestyle; and, address insufficient savings and inadequate pensions.

“HomEquity Bank is honoured to be on the PROFIT 500 ranking,” said HomEquity Bank CEO Steven Ranson. “Our reverse mortgage product is helping Canadian seniors remain in their homes, by allowing them to tap into the equity they have accumulated.”

“Companies become a part of the PROFIT 500 through innovative thinking, smart strategy and sheer grit,” says James Cowan, Editor-in-chief of PROFIT and Canadian Business. “These firms demonstrate what Canadian entrepreneurs can achieve, both at home and across the globe.”

About PROFIT and PROFITguide.com
PROFIT: Your Guide to Business Success is Canada’s preeminent media brand dedicated to the management issues and opportunities facing small and mid-sized businesses. For 34 years, Canadian entrepreneurs across a vast array of economic sectors have remained loyal to PROFIT because it’s a timely and reliable source of actionable information that helps them achieve business success and get the recognition they deserve for generating positive economic and social change. Visit PROFIT online at PROFITguide.com.

About Canadian Business
Founded in 1928, Canadian Business is the longest-serving, best-selling and most-trusted business publication in the country. With a total brand readership of more than 1.1 million, it is the country’s premier media brand for executives and senior business leaders. It fuels the success of Canada’s business elite with a focus on the things that matter most: leadership, innovation, business strategy and management tactics. We provide concrete examples of business achievement, thought-provoking analysis and compelling storytelling, all in an elegant package with bold graphics and great photography. Canadian Business – what leadership looks like.

About HomEquity Bank

HomEquity Bank is the only national provider of reverse mortgages to homeowners aged 55 and over, Canada’s fastest growing demographic segment. HomEquity Bank originates and administers Canada’s largest portfolio of reverse mortgages under the CHIP Reverse Mortgage and Income Advantage brands. HomEquity Bank has been the main underwriter of reverse mortgages in Canada since its predecessor, Canadian Home Income Plan, pioneered the concept in 1986.

For more information visit www.homequitybank.ca or call 1.877.503.2447.

SOURCE HomEquity Bank

For further information: on HomEquity Bank, or to interview Steven Ranson, please contact: Teresa Donia, iAMBIC Communications, teresa@iambic.ca, 905-508-5550; Yvonne Ziomecki, Senior Vice President, Marketing and Sales, HomEquity Bank, yziomecki@homequitybank.ca, 647-723-6812

Seniors want to stay at home but must renovate

renovate with a reverse mortgage

renovate with a reverse mortgageHomEquity Bank teams with Ipsos Canada to study top renovations required and how a reverse mortgage could be the answer.

TORONTO, April 6, 2016 – Most Canadian seniors want to remain in the family home as they age, but often must renovate and retrofit areas of the home as part of aging in place.

That is according to the results of a study conducted by HomEquity Bank and Ispos Canada, where 300 Canadian homeowners were surveyed from March 15th to 18th 2016.

The study focused on Canadians aged 55 and older and asked if renovations were needed to remain in their home, as well as what type of renovations and retrofits would be necessary and how they would be financed.

Here, below, are the key findings of the study:

  • 58% of respondents stated that improvements would be required.
  • 46% stated that minor renovations would be required.
  • 11% stated that major renovations would be required.
  • 44% of respondents who stated that improvements would be required indicated that their kitchens and/or bathrooms would have to be renovated to improve accessibility.

The study also showed how respondents planned to finance improvements: 62% plan to draw on savings; 25% plan to arrange a reverse mortgage or HELOC; 11% plan to utilize investments; 9% plan to sell existing assets; and, 7% plan to use other types of loans.

Accessibility remains the top issue when it comes to seniors remaining in the family home, according to Vince Agovino, Executive Director, AGTA Home Health Care, a company providing products and services – from Personal Support Workers (PSW) to home renovations – for barrier free living. In fact, the top areas his company addresses include: improving accessibility from the main floor to the second floor; improving accessibility from outside the home to inside the home; and, renovating the home so there is a full bathroom on the main floor.

Mr. Agovino founded the company in 2000, following his personal, and challenging, experience of helping his aging grandparents remain in the family home.

“It was very difficult as my grandparents aged. It was difficult to find the products they needed, such as bathroom safety equipment, and especially hard to find everything we needed in one place. We also needed a PSW and needed to explore financing. I discovered we were not unique in this situation,” he explained.

That led to the launch of AGTA Home Health Care, which, Mr. Agovino notes, strives to address and solve all aspects of barrier free living.

AGTA Home Health Care’s most common renovation projects include:

  • Improving accessibility from the main floor to the second floor, via a stair glide, starting at $3,000.
  • Improving accessibility from outside the home to inside, via a ramp, starting at $3,000.
  • Creating a full bathroom on the main floor of a home, starting at $10,000.

The February, 2015 Retirement Study of Canadians aged 55+, conducted by HomEquity Bank and The Brondesbury Group, detailed 47% of pre-retired and 56% of retired respondents stating that ‘staying in my home is critical for my quality of life.’

HomEquity Bank, the only Canadian bank working exclusively with seniors, helps elderly people remain in their homes through its CHIP reverse mortgage solution. Seniors can supplement their income via reverse mortgage monthly or lump sum payments.

About HomEquity Bank

HomEquity Bank is a Schedule 1 Canadian Bank offering the CHIP reverse mortgage solution www.chip.ca. It was founded 30 years ago as an annuity based solution addressing the financial needs of Canadians who want to access the equity of their top asset – their home.

About Ipsos Canada

Ipsos is one of the world’s largest independent market research companies. Its commitment to driving the industry with innovative, best in class research techniques that are meaningful in today’s connected society is a primary goal. www.ipsos.ca

For this survey, a sample of 301 Canadian homeowners aged 55+ was interviewed online via the Ipsos I-Say panel. Weighting was then employed to balance demographics to ensure that the sample’s composition reflects that of the age 55+ population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within +/ – 6% percentage points, 19 times out of 20, had all Canadian homeowners age 55+ been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.

SOURCE HomEquity Bank

 

reverse mortgages

Related article at BNN

What can seniors expect from the Liberals?

Canadian Seniors
Canadian Seniors
What can seniors expect from the Liberals?

Canadian seniors worried about finances may be wondering what changes they can expect now that a majority Liberal government has been elected.

“The comments we hear from seniors, every day, are that government changes are needed to areas affecting finances. Some are struggling while others face dire financial challenges,” notes Yvonne Ziomecki, SVP, HomEquity Bank, the only bank dealing exclusively with seniors.

“The most important promise of the Liberal government to retirees is what it won’t do and that is end pension income splitting. My spouse and I split my pension income. At the same time, the Trudeau government will introduce a new Seniors Price Index to ensure that Old Age Security benefits keep up with actual rising costs. Both policies will help us to remain in our home, which is a major priority for us,” explains Joyce Wayne, Professor Emeritus Journalism, Sheridan College and blogger, www.retirementmatters.ca

“On the downside, Justin Trudeau has pledged to cut the Tax Free Saving Account yearly contribution from $10,000 back to $5,500.  The increased TSFA limit was a critical piece of my retirement plan. Now I must calculate how much faster I’ll need to withdraw funds from my RRSP, and that means adding to my taxable income,” she adds.

According to the Liberal party website ‘Retirement Security For Our Seniors’ section, the new government plans to:

  • Restore eligibility for Old Age Security and the Guaranteed Income Supplement to 65, allocating an average of $13,000 annually to the lowest income Canadians as they become seniors.
  • Increase the Guaranteed Income Supplement for single, lower income seniors by 10% providing up to an additional $920 per year for Canada’s lowest income seniors. Current benefits generally ensure couples are able to stay out of poverty, however more than one in four single seniors is defined as low income. This will allocate $840 million by 2019 and benefit 1.25 million seniors, including 900,000 single women.
  • Develop a new measure for the cost of living faced by seniors: the Seniors Price Index. OAS and GIS will be indexed to this new, more accurate and more generous measure, rather than to the Consumer Price Index that reflects the wider population.  In periods when the Consumer Price Index grows faster than the Seniors Price Index, the traditional Consumer Price Index will be used. Pension income splitting will remain.
  • Work with provinces and territories, workers, employers and retiree organizations to enhance the Canada Pension Plan.
  • Introduce a more flexible and accessible Employment Insurance Compassionate Care Benefit so six months of benefits are available to those who provide care to a seriously ill family member, rather than only those caring for a loved one at risk of death.
  • Commit to a new, 10-year investment of $20 billion in social infrastructure, prioritizing significant new investment in affordable housing and seniors facilities.

HomEquity Bank, the only Canadian bank working exclusively with seniors, helps elderly people remain in their homes through its CHIP reverse mortgage solution, www.chip.ca and Income Advantage products. Seniors can supplement their income via reverse mortgage monthly or lump sum payments.

If you are looking for more information on a CHIP Reverse Mortgage please give me a call at 705-717-5598 or 647-559-5049 or email me at mcurry(at)mortgagewellness.ca. You can also use the Reverse Mortgage Calculator to see how much you would qualify for and get pre-qualified in minutes.

Michael Curry
Certified Reverse Mortgage Specialist
HomEquity Bank

The Mortgage Wellness Group Ltd.

About HomEquity Bank

HomEquity Bank is a Schedule 1 Canadian Bank offering the CHIP reverse mortgage solution www.chip.ca. The company was founded 29 years ago as an annuity based solution addressing the financial needs of Canadians who want to access the equity of their top asset – their home.

For further information: or to interview Yvonne Ziomecki or Joyce Wayne, please contact: Teresa Donia, iAMBIC Communications, teresa@iambic.ca, 905-508-5550; Yvonne Ziomecki, Senior Vice President, Marketing and Sales, HomEquity Bank, yziomecki@homequitybank.ca, 647-723-6812

CHIP Mortgage Trust Announces Redemption of Medium Term Notes

Homequity Bank

Homequity Bank

CHIP Mortgage Trust (“CMT” or the “Trust”) announced that it will redeem $100,000,000 principal amount of Series 2011-1 senior medium term notes (the “Notes”), on a pro-rata basis, on January 5, 2016. The redemption price will be $101,922,934.25, which includes accrued and unpaid interest to the Early Redemption Date. Further notice(s) may be issued to redeem the remaining $51,700,000 principal of the Notes prior to the expected final payment date of February 1, 2016.

The funds used to redeem the Notes were sourced from a combination of cash flow generated in the normal course of business, and from the issuance of Guaranteed Investment Certificates (“GICs”) by HomEquity Bank. HomEquity Bank has increased the diversification of its sources of funding, adding three major distribution relationships in the last 12 months.

“We are extremely satisfied with our ability to redeem the Notes early,” said Steven Ranson, President and Chief Executive Officer. “HomEquity Bank’s access to funds through the issuance of GICs has significantly enhanced our liquidity management capabilities, and has provided additional financial flexibility in our funding operations.”

Forward Looking Statements

CMT from time to time makes written and verbal forward-looking statements about business objectives, operations, performance, and financial condition, including, in particular, forecasted mortgage origination growth, as well as the likelihood of its success in developing and expanding its business. Forward–looking statements are typically identified by words such as “will”, “should”, “believe”, “expect”, “forecast”, “anticipate”, “intend”, “estimate”, “plan”, “may” and “could”.  These statements may be included in CMT’s annual and quarterly reports, regulatory filings, press releases, presentations and other communications. These forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of CMT. The uncertainties and contingencies include, but are not limited to, risks related to capital markets and additional funding requirements, credit and underwriting risk, fluctuating interest rates, asset quality and rates of default as well as those factors discussed in the documents filed on SEDAR. Actual results may differ materially from those expressed or implied by such forward-looking statements.  CMT does not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time, except as required under applicable securities legislation.

About CHIP Mortgage Trust

CMT is a wholly owned subsidiary of HomEquity Bank. HomEquity Bank is a Schedule 1 Canadian bank and is the only national provider of reverse mortgages to homeowners aged 55 and over, Canada’s fastest growing demographic segment. HomEquity Bank originates and administers Canada’s largest portfolio of reverse mortgages under the CHIP Reverse Mortgage ™ and Income Advantage ™ brands. HomEquity Bank has been the main underwriter of reverse mortgages in Canada since its predecessor, Canadian Home Income Plan, pioneered the concept in 1986.

CMT, a special purpose entity, finances a portion of HomEquity Bank’s reverse mortgage portfolio, which totalled approximately $1.9 billion as at September 30, 2015, with medium term notes.

SOURCE CHIP Mortgage Trust

For further information: Steven Ranson, President and Chief Executive Officer (416) 413-4663, or John Garofano, Treasurer (416) 413-4674.

HomEquity Bank

1881 Yonge Street, Suite 300
Toronto,ON M4S 3C4

For other bank inquiries:
Toll Free: 1-866-522-2447
Local: 416-925-4757

6 Retirement Planning Tips

Planning for retirement

Planning for retirement

Retirement planning:

Retirement is supposed to be that time in your life when you can take it easy and do the things you enjoy. If you have planned for your retirement properly then you will have that time and freedom that working didn’t allow. These days with the cost of living many people are having to work well past retirement age just to maintain their lifestyle. Below are some tips, that if implemented early enough, can help make your retirement plans a reality.

Start saving for your retirement as early as possible. Obviously the sooner you begin saving for retirement, the better off you will be. Most financial institutions and financial planners can set up a direct deposit type of account, that can deduct a contribution from your pay or account when you get paid. As long as it is a manageable amount, you will barely even notice it and set up properly can defer income taxes.

Plan for the lifestyle you want when you retire. Everyone is different, and we all wan to do different thing when we retire. If you want to travel the world, you need to realize that this will cost a lot more than gardening or fishing. Once again, a financial planner can help you achieve these goals and tell you how much you need to be saving now.

Try to invest in a variety of things. We all know the stock market goes up and down, but in the long term it always goes up overall. With this type of investment it is best to put your money into a mutual fund where it is invested in a variety of safer options like banks etc.. Investing in just one stock can be risky even with large established companies – remember; Delta Airlines, Enron, WorldCom? Currently VW stock has dropped 30-40% in a very short time.

Plan to make your investments last. These days people are living longer and doing more. While nobody know how long they will live for, you should plan for this to some degree. If you have a hundred thousand dollars invested at 5%, you should minus the rate of inflation so as not to deplete your investment.

Keep working if need be. It is better to work at least part time, than to live in poverty. Many people enjoy the interaction of getting out and seeing other people as it is known to have huge psychological benefits

Access some of your homes equity. With the rising cost of living, more and more people are using the equity in their home to maintain their lifestyle. While this option is not for everyone, it can benefit many seniors who are struggling financially. Reverse mortgages can also be used to purchase a property in retirement. This allows you to purchase a property you could not normally afford and not have any mortgage payments. Food for thought!

Reverse Mortgage Study

Homequity Bank

reverse mortgages

HomEquity Bank teams with Equifax Canada to study Debt in Retirement

Mortgage debt amongst seniors is increasing right across Canada, and for those aged 70 and older, it has increased 12 percent in comparison to 2013. That is based on the final results of a debt in retirement research study carried out by HomEquity Bank and Equifax Canada.

The research was carried out in July of 2015 and concentrated on Canadians aged 55 and older. It analyzed the main categories of debt including: mortgages, lines of credit, bank loans, car loans, credit cards and retail cards. The study provided a comparison period of 2013 and 2015.

“At HomEquity Bank, we’re not surprised to see the results of this study. Every day, we hear from seniors who are having difficulties with debt. It can be due to insufficient pensions, the high cost of living or costly health care issues, but debt is increasingly a concern for many seniors,” states Yvonne Ziomecki, SVP, HomEquity Bank.

Conclusions of the study:

Mortgage debt is growing fastest in the Greater Toronto Area and Quebec and less so in Alberta and British Columbia
In 2015, 16.5% of people aged 55 and older are holding a mortgage. This is an increase of 10% from 2013
The average mortgage balance for Canadians aged 55+ grew by 11% from $158,000 in 2013 to $176,000 in 2015
The average mortgage balance is highest in the 55 to 60 age group, at $189,000, and lowest for the 75+ age group at $134,000
Seniors aged 71 and older with a mortgage have an average balance of $140,000
Overall debt for those 70+ has increased by 12% between 2013 and 2015 versus only a 4% increase for those under 70.

“It’s shocking to find Canadians 71+ are still carrying hefty mortgages,” notes Laurie Campbell, CEO, Credit Canada Debt Solutions. “By this age, they are fully retired and there’s no opportunity to increase their income.”

In fact, the study is showcasing a more relaxed attitude towards debt, she adds, “and this can jeopardize retirement.”

The best case scenario is to “have your financial cards in good order in your early 50s and mortgage free by retirement,” Campbell explains.

HomEquity Bank, the only Canadian bank working specifically with seniors, helping elderly people remain in their homes through its CHIP reverse mortgage solution. Seniors can supplement their income via reverse mortgage monthly or lump sum payments or a combination of both. HomEquity bank also mortgages new home purchases allowing people to purchase a more expensive home without mortgage payments.

For more information on reverse mortgage products, and how they work, contact Michael Curry at 705-717-5598 or 647-559-5049 or use the contact form HERE.

About HomEquity Bank

HomEquity Bank is a Schedule 1 Canadian Bank offering the CHIP reverse mortgage solution. It was founded 28 years ago as an annuity based solution addressing the financial needs of Canadians who want to access the equity of their top asset – their home.

About Equifax

Equifax empowers businesses and consumers with information they can trust www.equifax.ca. A global leader in information solutions, Equifax leverages one of the largest sources of consumer and commercial data, along with advanced analytics and proprietary technology, to create customized insights that enrich both the performance of businesses and the lives of consumers.

SOURCE HomEquity Bank

Reverse Mortgages – Good or Bad Idea?

chip reverse mortgage

A lot more Canadians are using the economic value of their own property to make up for financial shortfalls, as they head towards retirement life. Many over the age of 55 find themselves house rich and cash poor. Numerous senior Canadians are on their way into retirement with either too much personal debt, or not enough savings, or in many cases both of those.

As they leave behind the labor force their earnings decrease but their financial obligations continue. So many are facing this scenario and managing it becomes stressful. Many property owners in this situation ask themselves if a reverse mortgage is the answer, since it would allow them to take funds out of their home, and continue to live there. Reverse mortgages can relieve financial challenges and allow seniors to live a little, do some renovating, or maybe give their children financial help.

Reverse mortgages are a good idea, but they should only be taken into consideration after all alternate options have been explored. Reverse mortgages do carry a higher rate of interest than a conventional mortgage although not much different from second mortgages or lines of credit. They do erode the equity in your principal investment, which in turn might need to be sold later. If you are prepared to overlook this, you are probably under financial pressure or perhaps you are not living the life you want after years of working hard.

HomEquity Bank offers reverse mortgages in Canada, the greater part of which are in larger more expensive cities like Toronto and Vancouver. The bank provides them through the Canadian Home Income Plan (CHIP).

Here is how reverse mortgages work:

To qualify you need to be over 55 and own a home, you can get up to 55 per cent of its value depending on your age. The money is tax-free and you do not have to pay anything back until you want to sell your house or you die. Then the principal and accrued interest is due in full, within six months or at closing of the sale of the home.

The rate is somewhat higher than a conventional mortgage mortgage with an “A” lender. HomEquity is offering a 5-year fixed reverse mortgage at 4.99 per cent compared to rates under 3% for a first mortgage to clients with excellent credit. After the five-year term is up, the rate is renegotiated and will depend on market conditions at that time.

The real cost is very easy to forget about as you are not making any payments unless you want to. HomEquity Bank, says their typical consumers are in their early 70s and borrow on average $110,000, and usually sell their home within six to eight years.

Ziomecki says the process involves a home appraisal and those with mortgages would not be turned down, though they would be able to borrow less. Applicants must have a lawyer to ensure they understand what’s involved. HomEquity encourages the entire family to get involved to avoid acrimony later.

HomEquity sees four types of customer:

Debtors (35%): They have poor money management habits and may be maxed out on department store and bank-issued credit cards. They have large credit lines and in some cases huge mortgages. It adds up to a reduced credit rating, and they often cannot obtain additional financing from their bank.

Spenders (30%): They desire a much better lifestyle without having the repayments. It could perhaps be a holiday home or a significant home refurbishment. They may not want to have a credit line given that they would have to make a payment each and every month.

Cash poor (17.5%): This group cannot make ends meet. Their pension income and savings are moderate. Many are single women or widows who did not work outside the home. They need the extra cash to stay afloat.

Unanticipated needs (17.5%): This could be big bills or a desire to deliver an early inheritance to their children. If the latter, giving the money makes them feel good.

HomeEquity had a banner year in 2014. Its reverse mortgage business increased 23 per cent and was worth $309 million. As more Boomers head into retirement, the company says it expects the growth to continue.