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Mortgage-Matters

Retirement problems

Since 2005, HSBC has done a survey about retirement and this report can give us a clearer view of what might lie ahead as you move toward retirement.

Both those still on the job and also those who have left the workforce were asked about their concerns and how they might have prepared differently for retirement.

Here are some of the key findings for Canada:

Current retirees 

  • 23 per cent saw their standard of living deteriorate after retiring
  • 31 per cent feel they did not adequately prepare for retirement

Pre-retirees 

  • 61 per cent worry about having enough money to live day-to-day
  • 68 per cent worry they will run out of money

Working age 

  • 81 per cent had a major life event hamper their ability to save
  • 37 per cent are not saving for retirement

Do you have any of the above concerns for yourself or a family member? If you are a homeowner, a reverse mortgage could allow you to covert, with qualification, a percentage of the value of your home into cash without having to move or sell your home.

There are many benefits to a reverse mortgage as it can help to relieve financial stress. There are no payments required as long as you live in the home.

You maintain ownership of your home and the money accessed with a reverse mortgage is tax-free and does not affect any pension income you are currently receiving.

If you are a homeowner over 55 and are in need of funds to pay debt or expenses this could be your solution.

Funds can also be used to purchase a home or to help seniors who want to remain in their homes by making the home more accessible.

The funds could pay for in-home care or medical expenses and are available in either a lump sum or installment payments. Other uses could include paying off debt, renovations or home improvements, travel or to assist children or grandchildren.

There are many myths about reverse mortgages. The bank does not own your home nor can they force you to sell. The rates, although slightly higher than a standard mortgage as no payments are required, are very reasonable.

The homeowner keeps all the equity remaining in the home.

In our many years of experience, over 99 per cent of homeowners have money left over when their loan is repaid.

The equity remaining depends on the amount borrowed, the value of the home, and the amount of time that’s passed since the reverse mortgage was taken out.

Once considered a solution of last resort, reverse mortgages are becoming a solution for retirees who have significant equity in their homes but limited cash resources.

You can also qualify even if you already have a mortgage on your property as the reverse mortgage could be used to pay off that mortgage assuming there is sufficient equity in the property.

If you are interested in more information about a reverse mortgage or have a senior in your life that may feel that they will be forced out of their home due to financial stress, please give me a call to review possible options at 1-888-561-2679 or email [email protected].

We can do a quick assessment to determine whether a reverse mortgage is a possible solution.



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About the Author

April Dunn is the owner and a Mortgage Broker with The Red Door Mortgage Group – Mortgage Architects. She has been assisting clients to purchase, refinance or renew their mortgages for over 20 years.

April has experience as a Credit Union manager, a Residential Mortgage Manager with a large financial institution and as a licensed Mortgage Broker. By specializing in Strategic Mortgage Planning she has the tools available to build a customized mortgage plan, with the features and options that meet your needs.

April provides a full range of residential and commercial mortgage financing options for clients all over the province of British Columbia and across Canada through the Mortgage Architects network.

Contact e-mail address: [email protected] or by phone at: 888-561-2679.

Website:  www.reddoormortgage.com



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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