041: How Does A Reverse Mortgage Work?

This week on the show, Kyle has Wendy Mason from HomEquity Bank on to talk about reverse mortgages.

 

Introduction

Wendy has 22 years’ of experience in the Financial Services Industry, the last 11 have been as a Mortgage Broker.  She believes in helping seniors live a better retirement.

HomEquity Bank was originally founded in 1986 as Canadian Home Income Plan Corporation in Vancouver, BC. Over the years, the company’s trajectory has led them to focus primarily on the CHIP Reverse Mortgage product for seniors, helping them to live a fulfilling retirement with financial stability.

 

Key Points (Click the timecode to go to that part of the interview)

  • [2:45] What is a reverse mortgage?
    • It’s a normal mortgage that you don’t have to make payments on.
    • You do have to be 55+.
    • Your “payment” comes from the sale of the house.
  • [4:20] How much money can you get?
    • Our algorithm determines the loan to value that we will lend and it is based on age.
    • Loan to value is the amount of money that the house is worth.
    • The maximum loan to value we offer is 55%. That number is reserved for seniors 80+.
  • [6:35] Why would I do this?
    • Maybe the senior’s income is being eaten up by their mortgage.
    • Maybe they are asset rich but cash poor.
    • Helping their children buy a home.
    • HomEquity will never take ownership of the home.
    • The money given is tax-free.
  • [14:00] Wendy shares some stories of seniors who benefited from a Chip Reverse Mortgage.
  • [26:00] There are 2 ways that the money can be taken out. 1st is a lump sum, the 2nd is by monthly payments.

Contact Wendy Mason

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