Separation and divorce can impact a family financially causing great stress. For the older Canadian, it is even more stressful, because most are on a fixed income and have limited options available to pay the other spouse based on the division of assets. For most couples, their home is their most significant asset and has lots of equity. If one spouse prefers to live in the home, a reverse mortgage can provide that much needed cash to pay out the other spouse who wants to move.
The spouse requiring the mortgage loan must be 55 years of age or older and own the home. There is no income qualification, no credit check, and no monthly mortgage payments. The amount of mortgage loan will be up to 55% of the appraised value of the home. This is tax-free money and does not affect your government benefits. The loan is re-paid when the homeowner no longer lives in the home.
As the life expectancy age rises in Canada, this provides a stress-free and financially stable option. It allows the spouse to stay in the home they love without dealing with the stress of moving as well as the divorce.