Reverse Mortgage FAQ

General reverse mortgage questions

  • How do I qualify for a reverse mortgage?

    Qualifying for a reverse mortgage with Equitable Bank is largely based on property type, location, and borrower’s age. We lend to borrowers aged 55+ with homes in urban centres in Alberta, British Columbia, Ontario, and Quebec.
  • Can I get a reverse mortgage with bad credit?

    You can. While it’s encouraged to have a sound financial history, life happens and unforeseen circumstances arise. We get it—that’s why we have options for everyone. 
  • With a reverse mortgage, who owns the house?

    No, you will not transfer ownership of your property to the bank when receiving a reverse mortgage.

  • Could I owe more than my house is worth with a reverse mortgage?

    As long as you have met your mortgage obligations, the amount you owe on the due date will not be more than the fair market value.
  • What options do I have for receiving my reverse mortgage funds?

    You can take the mortgage proceeds upfront as a one-time advance (an Initial Advance). Alternatively, you can take a large sum upfront (minimum amount of $25,000) and the remaining funds as Single Advances and/or Recurring Advances scheduled over several years.
  • Who is responsible for paying property taxes for a reverse mortgage?

    You must pay property taxes directly to the municipality.

  • What is a reverse mortgage holdback, and when is it done?

    At the time of application or during the life of the reverse mortgage, we may require a holdback to cover home repairs if deficiencies could affect liveability or have the potential to materially affect the home’s future value. We may also require a holdback if there are tax or condominium arrears.
  • Can a Power of Attorney (POA) apply for a reverse mortgage on my behalf?

    A POA for property may be used when applying for a reverse mortgage. Your attorney must have the ability to deal with real property. The POA will not be permitted to apply on your behalf simply because you are out of the country.
  • Can I receive counseling about reverse mortgage loans from Equitable Bank?

    Yes, we’re here to help. In addition, you will need to meet with a lawyer to receive Independent Legal Advice (ILA) to ensure you understand the product and the legal obligations.

  • How can I use the funds from a reverse mortgage?

    You could use the funds to cover daily expenses, home renovations, medical bills, in-home care, family needs, trips, or help a relative with a down payment, it’s up to you.

    We also offer a range of home-financing solutions. You can work with a mortgage broker to find a plan that works for you.

  • Can Equitable Bank sell or foreclose on my home?

    If you continue to meet your mortgage obligations, you should have no concerns about losing your home to the bank.
  • What if I already have a mortgage on my property?

    If you have a mortgage, it must be paid off so that the reverse mortgage can be registered in first priority. You can use the proceeds from the initial advance to pay off your existing mortgage, any outstanding debt, or lien registered against the property.

  • Who gets the profit if my home appreciates?

    You do. You must repay the value of the mortgage principal, interest, and any fees. If your home increases in value, the gains are yours to keep.
  • Which provinces does Equitable Bank service with reverse mortgages?

    A reverse mortgage with Equitable Bank is available in Alberta, British Columbia, Ontario, and Quebec.
  • Do you offer reverse mortgages on mobile homes, condos, and apartments?

    At Equitable Bank, we offer reverse mortgages on detached, semi-detached, townhomes, and condos.

  • Can I get out of my reverse mortgage?

    Yes, you can. We recognize needs change and our product is designed for that. That’s why we offer flexible options to repay a portion of principal and interest. If you choose to repay the entire balance, there may be a prepayment charge.
  • How much equity do I need for a reverse mortgage?

    The value of the reverse mortgage must be equal to or greater than the value of any loan secured against the property.

    For example, a borrower who qualifies for 40% on a $500,000 home could access $200,000, provided any loans they have secured by the home are less than $200,000.

Reverse mortgage rates, fees, and regulations

  • Is there an age requirement to qualify for a reverse mortgage?

    Yes, you must be at least 55 years old to qualify for a reverse mortgage with Equitable Bank.
  • How can I use my reverse mortgage funds?

    However you like. Many Canadians use their reverse mortgage funds to repay existing loans or mortgages, help family members, purchase a new property, or simply to lead a more comfortable life.
  • What fees do I have to pay with a reverse mortgage from Equitable Bank?

    Equitable Bank charges a one-time set-up fee of $995. Much like a regular mortgage, there are additional appraisal and Independent Legal Advice fees that come with closing a reverse mortgage.

  • How can I reduce my reverse mortgage interest rate?

    To reduce interest accumulation, you can limit the amount of your initial advance and take out additional funds only as needed. There’s also the option of paying down interest monthly, without a prepayment charge.
  • Are reverse mortgage rates higher than standard mortgages?

    Because no payments are required until the mortgage is due, reverse mortgage rates tend to be higher than standard mortgages. We offer a range of fixed and adjustable interest rates so you can choose the interest rate that works best for you.
  • Is there a setup fee for a reverse mortgage?

    There is a setup fee of $995.00, which will be deducted from the initial advance.

Reverse mortgage planning

  • What happens if I outlive my reverse mortgage with Equitable Bank?

    Technically, you can't "outlive" a reverse mortgage.

    As long as you meet your mortgage obligations, like paying property taxes and home insurance, the amount you owe on the due date will never be more than the fair market value.

  • What if my spouse dies after I get a reverse mortgage?

    If both spouses are registered as joint tenants, the surviving spouse can continue to be a borrower and is entitled to all the benefits a reverse mortgage has to offer.
  • What is the minimum property value required for a reverse mortgage from Equitable Bank?

    The appraised value of your home must be at least $250,000.

  • How much equity will I have left?

    At any time, the remaining equity on your home will depend on the difference between the home’s current value and the amount owing on the reverse mortgage. Learn more.
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