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CHIP Reverse Mortgage

Finanso.Multilogin™

About lender

CHIP Reverse mortgage is a lending solution from Home Equity Bank offering online mortgage loans for Canadian homeowners aged 55+.

A reverse mortgage is a loan secured by your home. In a traditional mortgage, you pay a bank, while a reverse mortgage pays you.

CHIP Reverse mortgage allows access to up to 55% of the home’s value in tax-free cash with no monthly repayments.

Canadian Home Income Plan (CHIP) Corporation was established in Vancouver, British Columbia, in 1985 to help Canadians 55+ get the cash they need to live in a comfortable and secure retirement home they love without worries about regular payments.

The company operates in all ten provinces in Canada.

Features

You can borrow up to 55% of your home value. The amount depends on your age, home's value and location, personal debts, and credit score.

You can use a reverse mortgage calculator on the official website to enter these details and determine how much money you could be eligible for.

The borrowing money is tax-free cash. You don't have to make any monthly payments; only keep your taxes and insurance updated.

Loan purposes aren't limited.

With a CHIP Reverse Mortgage, you retain the ownership of your home and maintain the title, even if your income or home value changes.

The interest rates are typically higher than traditional mortgages, and the balance steadily increases.

The early repayment charge may be applied if the loan is repaid within the first five years.

Other CHIP products include Income Advantage (which provides a steady stream of income to boost the current retirement income), CHIP Max (more immediate access for younger clients to a higher percentage of their home equity), and CHIP Open (made for homeowners 55+ searching for a short-term financing solution with the option to repay the total loan amount at any time without prepayment penalties.)

Pros and cons

Look through this pros and cons review to decide whether a CHIP Reverse mortgage is your solution.

Pros

  • A lump sum or regular advances payouts

  • Access to 55% of home value

  • Loans for any purpose

  • No monthly payments

  • Funds are tax-free

  • You stay in your home

  • A stable long-term bank program

  • Operating all over Canada

Get acquainted with the drawbacks you should know before borrowing.

Cons

  • A lot of fees are charged

  • The minimum property value is $200,000

  • Your primary residence only

  • Available only for homeowners 55+

  • High-interest rates

CHIP Reverse Mortgage is a good solution for borrowers who want to boost their retirement income, pay health expenses, pay off debts or make home renovation while staying in the home.CHIP Reverse Mortgage has advantages and disadvantages, but borrow responsibly: calculate all charges and rates.

Loan conditions

The annual interest rates depend on the term: 6,40% — 7,67%. Variable and fixed terms are available. The HomeEquity Bank prime rate determines variable, and fixed are available for six months, 1, 3, 5 year periods.

There are no monthly payments. You can repay at any time — paying off the amount borrowed plus the accrued interest. However, if you move out or sell your home, you must repay your reverse mortgage.

There is an appraisal fee, an administrative fee, closing fees, and fees for independent legal advice depending on the mortgage type.

The closing and administrative fees cover the cost of discharging any prior mortgage and registering the CHIP Reverse Mortgage. Usually, it is added to the mortgage balance rather than paid out directly. It is about $1,795 to $1,995.

Methods of loan funding

You can receive all of the money at the time of closing, in one lump sum. Or take some of the money at the time of closing and set aside the rest to request whenever you want.

Another option may be monthly deposits delivered directly to your bank account.

FAQ

What is CHIP?

CHIP is a corporation currently known as HomeEquity Bank. It is offering a reverse mortgage product that is designed to turn your home equity into tax-free cash with no monthly payments.

Who owns CHIP?

Canadian Home Income Plan (CHIP) Corporation was established in Vancouver in 1986 and was renamed Home Equity Bank, and it is on the list of Chartered Schedule I Canadian Banks.

How do you qualify for a CHIP Reverse Mortgage?

To qualify, a borrower should:

  • Be a Canadian resident

  • Be 55+

  • Live in the house for at least six months of the year

  • Have the property with the appraised value of $200,000 minimum

How much can you borrow from CHIP?

Up to 55% of the appraised value of your home in tax-free cash. The amount will depend on the value, type, location of your home, and age.

Is CHIP a legitimate company?

Yes, it is. Home Equity Bank has been providing CHIP (Canadian Home Income Plan) Reverse mortgages in Canada for 30 years. It has a 4.7/5 rating based on 768 reviews at TrustPilot.

How does CHIP Reverse Mortgage work?

You can apply through the official CHIP website or call 1-866-758-2447. Get your estimate based on the age and property info.

Talk to a specialist about the amount you could be eligible for. Determine the frequency and type of cash you will receive. Get the tax-free money.

 Receive the money in the form of a lump sum or regular monthly payments.

Online you could apply 24/7, and by phone during business hours Monday – Friday 8:30 a.m. to 8:00 p.m.

Company documents

Privacy Policy
Terms
Reverse Mortgage Rates

For over 30 years, HomeEquity Bank has provided the CHIP Reverse Mortgage® to Canadian homeowners aged 55+. It is a safe and secure financial solution that enables homeowners to access the equity in their home without the need to move or sell. CHIP empowers our customers to live retirement their way, in the home they love.

© HomeEquity Bank

Financial products

CHIP Reverse Mortgage
Reverse Mortgage
Rating by Finanso®
i

The rating by Finanso® is determined by our editorial team. The scoring formula includes a financial product type as well as tariffs, fees, rewards and other options.

Recommended FinScore™
0
300
650
1000
$100,000-$500,000
Rate
i

Effective interest rate on the product

up to 7.67%
Term
i

Loan term for the financial product

up to 25 years

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Calculate loan payments in CHIP Reverse Mortgage

CHIP Reverse Mortgage calculator will allow you to calculate an approximate payment schedule for the loan

Loan amount
i

Enter the desired loan amount

CAD
CAD
100000 $
500000 $
Loan term
i

Specify the loan term for the calculation

years
months
5
25

What to pay attention to when applying for a loan from CHIP Reverse Mortgage

  1. The company must have a license if it runs business in Alberta, British Columbia, Manitoba, Ontario and Quebec.
  2. You can check the availability of the relevant license (copy) at the branch of the lending company.
  3. Membership in a self-regulatory organization (SRO) is an additional guarantee of the reliability of the lending company. This information can also be checked at the company's branch or on its official website.
  4. Availability of lending policies.
  5. The procedure for applying for a loan.
  6. The procedure for concluding the loan agreement and receiving the payment schedule.
  7. Other conditions for granting loans.

We recommend

  1. To check out the interest rates and frequency. 
  2. Check the availability of individual terms in the loan agreement (principal amount, term, date of advance, etc.).
  3. Check whether the loan agreement contains information about the total cost of borrowing.
  4. Take time to think – you can change your mind before agreeing or signing a loan agreement.
  5. Speed of loan processing.
  6. Accessibility – alternative lenders often operate where there are no bank branches.
  7. For the borrower - high interest on the loan.
  8. For an investor, the safety of funds is not guaranteed by the state.

What distinguishes CHIP Reverse Mortgage from banks:

  1. Simplicity - loan processing is less formalized than in a bank.
  2. Fast loan processing.
  3. Accessibility.
  4. For the borrower - high interest on the loan.
  5. For an investor, the safety of funds is not guaranteed by the state.
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