Is a reverse mortgage right for you?
What is a CHIP reverse mortgage?
A CHIP reverse mortgage allows Canadians 55 and older to unlock up to 55% of the value of their home to assist with any financial need. The money received from a reverse mortgage is tax-free, there are no health checks to qualify for and no payments are required interest or principal for as long as at least one borrower lives in the home. The homeowner(s) maintains title ownership of the home at all times. The home must be your principal residence and the property can be a house, townhouse, or condo, as long as there is enough equity to qualify.
Reverse mortgage loans can be used to:
● Pay off or consolidate debt;
● Supplement income;
● Finance home renovations or repairs;
● Pay for unexpected medical or emergency expenses;
● Financially aid a family member(s) or,
● Improve your standard of living by paying for a vacation getaway or making a special purchase.
The truth is, debt in retirement used to be a faux-pas, but today, more and more Canadians are entering retirement with growing debt. The average life expectancy is higher than ever and the cost of living is often greater than pension incomes.
Since 2005, HSBC has surveyed more than 140,000 people in 15 countries about retirement. The following are keys findings for Canada:
● Retirees 23% saw their standard of living deteriorate after retiring. 31% feel they did not adequately prepare for retirement.
● Working Age 81% had a major life event hamper their ability to save. 18% had their ability to save hurt by the economy. 37% are not saving for retirement.
● Pre-Retirees 61% worry about having enough money to live day-to-day. 40% are not confident they can maintain a comfortable retirement. 68% worry they will run out of money. 44% are not preparing adequately and 52% cite their mortgage or debts as the reason.
● Non-Traditional Sources of Income 65% point to a domestic second property. 32% consider a foreign second property as a source of funds.
A reverse mortgage is a smart way for seniors to access the equity theyve accumulated in their home as tax-free cash. Despite the fact that reverse mortgages have been in Canada since 1986, there are still a lot of misunderstanding. Much of the media and misinformation about reverse mortgages is rooted in the U.S. In the U.S., there are numerous reverse mortgage providers, each offering different features. HomEquity Bank, the only provider of reverse mortgages in Canada, is a federally regulated Schedule 1 Canadian Bank, which ensures that you have a trusted and secure bank providing you with your reverse mortgage. Over the years, HomEquity Bank has been improving the reverse mortgage program, making interest rates more competitive, adding term options and increasing the amount of home equity a client can access. It is also mandatory for clients to seek independent legal advice before being approved for a reverse mortgage.
After first learning about CHIP from her mortgage broker, Karen used her money to pay off debt that had built up after her husbands stroke. Creditors are no longer calling and she is now free to spend quality time with her husband.
Bill and Linda learned about the CHIP benefits and used the money for much needed home renovations and repairs which they werent able to previously pay for.
Miriam was able to take a trip she always promised herself with extended family and friends without having to take money from her precious retirement savings.
Contact me today if you would like more information on a reverse mortgage and find out if it is the right product for you.
Diane Sainsbury, Certified Reverse Mortgage Specialist
(Simcoe County) 705-445-2584 (Toronto) 416-820-8471
Bank of Canada increases overnight rate target to 3/4 per cent
The Bank of Canada is raising its target for the overnight rate to 3/4 per cent. The Bank Rate is correspondingly 1 per cent and the deposit rate is 1/2 per cent. Recent data have bolstered the Banks confidence in its outlook for above-potential growth and the absorption of excess capacity in the economy. The Bank acknowledges recent softness in inflation but judges this to be temporary. Recognizing the lag between monetary policy actions and future inflation, Governing Council considers it appropriate to raise its overnight rate target at this time.
The global economy continues to strengthen and growth is broadening across countries and regions. The US economy was tepid in the first quarter of 2017 but is now growing at a solid pace, underpinned by a robust labour market and stronger investment. Above-potential growth is becoming more widespread in the euro area. However, elevated geopolitical uncertainty still clouds the global outlook, particularly for trade and investment. Meanwhile, world oil prices have softened as markets work toward a new supply/demand balance.
Canadas economy has been robust, fuelled by household spending. As a result, a significant amount of economic slack has been absorbed. The very strong growth of the first quarter is expected to moderate over the balance of the year, but remain above potential. Growth is broadening across industries and regions and therefore becoming more sustainable. As the adjustment to lower oil prices is largely complete, both the goods and services sectors are expanding. Household spending will likely remain solid in the months ahead, supported by rising employment and wages, but its pace is expected to slow over the projection horizon. At the same time, exports should make an increasing contribution to GDP growth. Business investment should also add to growth, a view supported by the most recent Business Outlook Survey.
The Bank estimates real GDP growth will moderate further over the projection horizon, from 2.8 per cent in 2017 to 2.0 per cent in 2018 and 1.6 per cent in 2019. The output gap is now projected to close around the end of 2017, earlier than the Bank anticipated in its April Monetary Policy Report (MPR).
CPI inflation has eased in recent months and the Banks three measures of core inflation all remain below 2 per cent. The factors behind soft inflation appear to be mostly temporary, including heightened food price competition, electricity rebates in Ontario, and changes in automobile pricing. As the effects of these relative price movements fade and excess capacity is absorbed, the Bank expects inflation to return to close to 2 per cent by the middle of 2018. The Bank will continue to analyze short-term inflation fluctuations to determine the extent to which it remains appropriate to look through them.
Governing Council judges that the current outlook warrants todays withdrawal of some of the monetary policy stimulus in the economy. Future adjustments to the target for the overnight rate will be guided by incoming data as they inform the Banks inflation outlook, keeping in mind continued uncertainty and financial system vulnerabilities.
The next scheduled date for announcing the overnight rate target is September 6, 2017. The next full update of the Banks outlook for the economy and inflation, including risks to the projection, will be published in the MPR on October 25, 2017.
This is an opportunity to gather in our communities, from coast to coast to coast, and to proudly celebrate all we have in common. It is an opportunity to celebrate our achievements, which were born in the audacious vision and shared values of our ancestors, and which are voiced in nearly all of the languages of the world through the contribution of New Canadians.
Canada Dayis a time to celebrate the heritage passed down to us through the works of our authors, poets, artists and performers. It is a time to rejoice in the discoveries of our scientific researchers, in the success of our entrepreneurs, and to commemorate our history a history in which each new chapter reveals itself to be more touching, more fascinating than the last.
In this momentous year marking the 150th anniversary of Confederation, our Canada Day celebrations will be bigger than ever! There will be major celebrations in 19 Canadian cities in addition to the many festivities set to take place in various communities from coast to coast. A full weekend of activities is also on the agenda in Canadas Capital Region to celebrate Canada Day and our countrys anniversary in a spectacular way.
As we look ahead, we have every reason to show our pride in being Canadian and to face the future with confidence and enthusiasm.
Activities across Canada
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