What Is a Reverse Mortgage?

A reverse mortgage lets Canadian homeowners 55 and older access a portion of their home's equity without selling, without moving, and without making monthly payments.

Think of it this way. Over decades, you've been paying your mortgage and building equity. A reverse mortgage lets you convert some of that equity back into cash. The loan is repaid only when you sell the home, move out, or pass away.

How It Works

You apply through a licensed mortgage broker. The amount you can access depends on three things: your age, the value of your home, and its location. Generally, the older you are and the more your home is worth, the more you can access, up to 55% of your home's value.

You can receive the funds as a lump sum, in scheduled payments, or a combination. The money is tax-free and doesn't affect your Old Age Security (OAS), Guaranteed Income Supplement (GIS), or Canada Pension Plan (CPP) benefits.

What Makes It Different

Unlike a home equity line of credit (HELOC) or a traditional mortgage refinance, there are no monthly payments with a reverse mortgage. Interest accrues on the borrowed amount, but nothing is due until the loan ends.

And here's the key protection. You can never owe more than your home is worth. This is guaranteed by Canadian reverse mortgage lenders. If the loan balance exceeds your home's value, the lender absorbs the difference, not you, and not your family.

Who It's For

Reverse mortgages are designed for homeowners who want to stay in their home while accessing the wealth they've built. Common reasons include supplementing retirement income, covering healthcare costs, helping adult children with a down payment, or simply enjoying retirement without financial stress.

It's not for everyone. But for many Canadian seniors, it's a way to live well with what they've already built.

Want the Full Picture?

We wrote a free 14-page guide that walks through everything: who qualifies, how much you can access, the most common myths, and how to talk about it with your family. Download the Living Legacy guide or book a free conversation with our team.