Don’t-Pay-Till-You-Die Mortgage By Canadian National Mortgage Corporation
Did you know that most home-owners are usually asset rich but cash poor? To pay off their mortgages quickly, they tend to save very little and are faced with money struggles once they reach seniority. If you’re worried about facing a similar fate, or if you’re experiencing the struggles of being house poor, there is a solution to cover your financial needs with little to no stress.
In the great nation of Canada, once you reach seniority, you are eligible for a reverse mortgage or a Don’t-Pay-til-You-Die mortgage. The reverse mortgage product enables you to tap into the accumulated wealth in your home by converting your house equity into “NOW-Money.” This mortgage solution also comes with no monthly payments for as long as you live in your house.
The money available through a reverse mortgage can be utilized to cover necessary living expenses and health care needs. There are no restrictions on how the proceeds from a reverse mortgage can be used, which makes it is incredibly advantageous for seniors above the age of fifty-five.
The benefits of a Don’t-Pay-till-You-Die mortgage
Most seniors view their house as a forever home and do everything within their power to avoid changing that. However, there is always a need for cash. Over time, you’ll need to repair and maintain your property, upgrade the kitchen, and complete your household bucket list. Besides, as your kids grow into adults, you’ll realize that helping them can cost money. For instance, they may need help paying a lump sum amount as their down payment toward a house purchase. They could also be struggling to give their children an education, or the classes to encourage their passion for hockey or ballet, and a little extra money from an early inheritance could go a long way.
While your financial requirements may include the above, they may not be limited to them. To meet your financial needs, the reverse mortgage program allows you to take out a lump sum or a fixed amount each month. In other words, you can borrow as much as $200,000 and give it to their children as a gift toward their house purchase, or you can use as little as $3,000 a month as spending money. The beauty of this mortgage is that there is no payback requirement for as long as you live.
The only requirements that come with a Don’t-Pay-till-You-Die mortgage are these:
1. You must live in the house (against which you’re borrowing money).
2. Property taxes must be paid and kept up to date.
3. The property must be maintained in good order.
Although there are no monthly payments required here, there is an interest that is accumulated each month. If you borrow $100,000 and the interest is six percent, after one year, you will owe $106,000. With a regular mortgage, the $6000 is repaid in the form of $650 a month. The first $500 is the interest, the balance of $150 is used to apply again the amount owing to reduce the mortgage balance.
What are your alternatives to a reverse mortgage
The alternative to a reverse mortgage is a conventional mortgage, but the drawback with a traditional mortgage is the monthly payment. The more money you need, the higher your monthly payment gets.
You could also opt for a secured line of credit, but again money payment is mandatory in the case of a line of credit. Besides, secured lines of credit are actually mortgages. Bankers know people do not like the word mortgage, so they use different terms like secured lines of credit, home equity loan, HELOC, etc.
Where can you get a reverse mortgage
A reverse mortgage is a specialized product. There are many government regulations associated with this mortgage, especially as most clients are seniors. As a result, you must consult with a mortgage broker who is licensed in Ontario to deal with mortgages and provide reverse mortgage solutions.
For a knowledgeable reverse mortgage consultant in Ontario to access your home’s equity, reach out to Canadian National Mortgage Corporation. As a leading provider of mortgage solutions in Mississauga, Ontario, we help you find the right solutions for your needs. To book a consultation with us, give us a call at (416) 410-6663 or email us at email@example.com.
Our founder, David So, is a licensed mortgage broker in the province of Ontario with over thirty years of experience. He understands different financial requirements and expertly guides clients through the best steps to improve their financial standing and successfully obtain a mortgage. Moreover, he listens to their needs first, then tailors solutions that meet their unique requirements.