Reverse mortgages, Ontario, 55+
A plain-language guide to the CHIP Reverse Mortgage and Income Solution for homeowners 55 and older. What they are, what they cost over time, what you still owe the home, and when another option fits better.
Who does what
CHIP Reverse Mortgage and Income Solution are products of HomeEquity Bank. The bank sets the terms, rates and approval decisions. Empower Approved is a mortgage brokerage: we explain how these products work, compare them against a HELOC, refinance or downsizing, and help you prepare questions for the lender and your lawyer.
We are not the lender, and nothing on this page is an offer, an approval or a rate quote. Product details are summarized from HomeEquity Bank and the Financial Consumer Agency of Canada, linked below.
Bring a family member or trusted adviser to the conversation if you like. A reverse mortgage is a long-term decision for your household and your estate.
Eligibility
Canadian homeowners must be 55 or older. HomeEquity Bank says both you and your spouse must be 55+, not just the person making the enquiry. Confirm requirements for everyone on title with the lender.
The property must be your primary residence in Canada.
HomeEquity Bank lists a minimum appraised home value of $250,000.
Up to 55% of appraised value, depending on age, location, property type, condition, existing equity and underwriting. The maximum is not guaranteed.
An existing mortgage must be repaid using CHIP proceeds, reducing the cash you actually receive. Other secured debts, including a HELOC, may also need to be paid off and closed.
Two ways to receive funds
Funds are advanced as a lump sum, after any existing mortgage is paid out. Suits a one-time need, such as a renovation or clearing debt. Interest accrues on the full amount from day one.
Scheduled, mandatory monthly or quarterly advances. These are not pension or investment income. They are borrowed money that adds to your balance with each payment, and future advances remain conditional on the terms of your agreement.
A new roof, a main-floor bathroom or a stair lift can make staying home possible. Get quotes first and borrow for the real cost, since every dollar compounds.
Scheduled advances may help fund care. Care needs can change, and moving into long-term care may trigger repayment if the home is no longer your residence.
Replacing debt payments can ease cash flow, but you are swapping payable debt for a growing balance at a typically higher rate. Address spending pressure, not just the symptom.
What it costs
We do not list rates or fee promotions here. These are the categories to expect, all of which should appear in writing.
No regular payments are required, so interest is added to the balance and then charges interest itself. The amount owed grows over time.
Reverse mortgage rates are usually higher than a conventional mortgage or HELOC. Compare the rate in your written offer, not a headline.
An independent appraisal confirms the value the lender relies on.
You will need your own lawyer to review the agreement before signing.
Administrative and closing costs are typically charged. Ask for every fee in writing.
Repaying early, or selling within certain periods, can trigger prepayment charges under the agreement.
Over time your equity, and what your estate receives, may shrink considerably.
Your obligations
Generally when the home is sold, when you move out, or after the last borrower dies, subject to the agreement. Surviving spouse rights and the time an estate has to repay need review by your lawyer before signing.
Negative equity protection
HomeEquity Bank offers a qualified no-negative-equity guarantee: if you meet your obligations, the covered amount owed generally will not exceed the home’s fair market value. The exclusions below still apply.[source 3: HomeEquity Bank, Income Solution, opens in new tab]
It depends on compliance with the agreement. It explicitly excludes administrative expenses and interest that accrues after the loan becomes due. It does not promise an inheritance, and it does not mean every asset or every dollar is protected in every circumstance.
Tax and benefits
Because proceeds are a loan, they are generally not taxable income. The Financial Consumer Agency of Canada states that reverse mortgage proceeds do not affect Old Age Security or the Guaranteed Income Supplement.[source 4: Financial Consumer Agency of Canada, Reverse mortgages, opens in new tab]
How you use the money can still matter. Investing it, for example, can generate earnings with tax or benefit consequences. We do not make blanket promises about taxes or benefits; please consult a qualified tax adviser.
Alternatives
Usually a lower rate and flexible draws.
Requires income and credit qualification, regular payments, and the rate is often variable. Lenders can reduce or freeze limits.
Can lower cost of borrowing or consolidate debt.
Monthly payments are required and you must qualify under current lending rules.
Frees equity without new debt.
Moving, real estate commission, land transfer tax and legal costs add up, and it means leaving the home.
HomeEquity Bank also lists Custom Solutions, tailored borrowing for more complex goals. If your needs do not fit the standard products, we can discuss whether to ask about it.[source 1: HomeEquity Bank, homepage, opens in new tab] Read our HELOC guide.
Where we help
Our only office is in Brampton. Ottawa, London, Niagara Falls and the wider GTA are served by phone, video and email, with local independent appraisers and lawyers.
Our office is in Brampton, Peel Region
Handled remotely by phone and video
Handled remotely by phone and video
Handled remotely by phone and video
Questions
Yes. You stay on title and keep ownership. The lender registers a mortgage against the property, just like any other mortgage, and you remain responsible for property taxes, insurance and upkeep.
That can still work. The existing balance is generally paid off from the reverse mortgage proceeds at closing, so your net cash is the approved amount minus that payout and closing costs. If the existing debt is large, the remaining amount may be small.
HomeEquity Bank says both you and your spouse must be 55 or older. Confirm how the lender will treat each owner and spouse, including anyone not on title. Repayment is generally triggered when the home is sold, when you move out, or after the last borrower dies, subject to the agreement. Ask your lawyer about surviving-spouse rights and occupancy before signing.
The rate, compounding interest, appraisal, independent legal advice, setup and closing fees, and possible prepayment charges. We walk through each line of a written offer with you. We do not publish rates or promotions on this page because they change and depend on your file.
Possibly less than they would otherwise. The balance grows over time and is repaid from the home when the loan comes due, reducing what is left for your estate. Estates also face a deadline to repay, which a lawyer should explain. A reverse mortgage does not promise any inheritance.
Borrowed proceeds are generally not taxable income, and the FCAC states that the proceeds do not affect OAS or GIS. What you do with the money can matter: investment earnings, for example, may carry tax or benefit implications. Speak with a qualified tax adviser about your situation.
Next step
A licensed agent will walk through your goals, the alternatives and what to ask the lender and your lawyer. No obligation and no approval promised.
Checked October 6, 2026. Product terms change; confirm current details with the lender and your lawyer.
Empower Approved provides brokerage guidance, not lender approval. CHIP Reverse Mortgage and Income Solution are HomeEquity Bank products. This page is general information, not individualized legal, tax or financial advice.
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