For those in their 30s and 40s, the “golden years” are a dream of a distant, relaxing, care-free future. Unfortunately, the realities of retirement can be a little less than perfect. Even if you have reached your financial goals and your home is paid off, you still may find yourself living on a budget. The good news is that your Calgary mortgage broker can help with a reverse mortgage that allows you to make use of your home equity to supplement your income if necessary.
Over the last forty years, there has been a dramatic rise in home values. A couple who bought a home in the 1960s or 1970s for $25,000 might find that same home worth half a million dollars (or more) today. Why shouldn’t they be able to put the added value of that home equity toward unexpected expenses or enjoying an active retirement?
How Does a Reverse Mortgage Work?
Designed for homeowners age sixty and up, reverse mortgages are an innovative estate management and investment product that have been available to Canadians for more than twenty years. A reverse mortgage allows older citizens to convert equity into cash — in the form of a lump sum, line of credit or monthly payment. Providers look at the current value of your home and the predicted growth of the market to make an assumption about what your home will be worth years down the road when your estate is settled. A Calgary mortgage broker can serve as your guide to make sure you are getting the most opportunity you can from your reverse mortgage.
What Are the Benefits?
In the past, if a retired person needed cash, he or she might have to sell their home to raise necessary funds. With a reverse mortgage homeowners are able to use their home equity to enhance their retirement while maintaining ownership of their property. The borrower gets a certain amount of money and does not have to prove he or she is credit-worthy or make payments while they remain in the home. You are still responsible for property taxes, maintenance or condo fees, and insurance, but you could use part of your reverse mortgage to cover those costs. In fact, you have complete flexibility over how you use the money. You could travel around the world, make upgrades to your home, or pay for medical expenses — it’s your money and your choice. Your estate is well-protected, and you are in charge. With a reverse mortgage:
- You can realign your assets to improve your retirement as you see fit.
- You can get as much as 40 to 50 per cent of your home’s value — tax free.
- You can save money on taxes if you put your money into other types of investments.
- You stay in your home.
- You control your future.
Enjoying Today and Planning For The Future
Your Calgary mortgage broker understands all the ways home ownership can positively affect your future. By working with a broker to plan your mortgage, you have the guidance of a professional who knows the market and has access to a variety of products to meet your needs. There is no cost to you, and you won’t be at the mercy of a single lender. Getting pre-approved for any type of mortgage doesn’t have to be a chore. At Mortgages by Candice, we will guide you through the pre-approval process, so you will know exactly where you stand at every step of the way.
While you have to be sixty or older to qualify for a reverse mortgage, that doesn’t mean you have to be retirement age to develop goals and an effective plan for your future. In fact, a skilled mortgage broker can help you select the right mortgage now, so if you choose a reverse mortgage later on after your home is paid off, it won’t be because you can’t afford your living expenses—it will be to get the most out of your free time.
Who wouldn’t want to put their home equity to use, right now while you can enjoy it? As with any mortgage, there are pros and cons to consider, but if you have looked at the big picture and think a reverse mortgage might be right for you, your Calgary mortgage broker is here to help. Contact Mortgages by Candice today and learn more.