Chip Advisor Mortgage

The CHIP Program: A Canadian Solution for Homeowners


The CHIP Reverse Mortgage® (once called The Canadian Home Income Plan) is 100% Canadian, provided by HomeEquity Bank, a Federally regulated, Schedule 1 Canadian Bank. It was founded in 1986 and has since been serving Canadians for over 30 years. HomeEquity Bank understands the needs of Canadians age 55 and over. With a conservative approach to our lending practices, HomeEquity Bank provides Canadians with the security and high regulatory standards that come with being a Canadian bank.

  • Benefits of the CHIP Program
  • How can you use the CHIP Program?
  • Qualifying for the CHIP Program:
  • Repayment of the CHIP Program
  • What Are the Pros and Cons of the CHIP Program?
  • What is a Reverse Mortgage?
  • Reverse Mortgage Eligibility & Qualifications

The CHIP Program is designed for Canadian homeowners age 55 years and older who want to live retirement on their terms. If you’re like most Canadian homeowners 55+, much of what you own fits into two categories – the equity in your home and the money you have saved. It is likely that the value of your home has grown over the years and makes up a large portion of your net worth. And while it is positive that your home has built value – this value is not accessible unless you decide to sell your home. The CHIP Program allows you to access up to 55% of its value without having to sell your beloved home. And best off all, you don’t have to make regular mortgage payments until you eventually move or sell. Additionally, the money you borrow is tax-free and it does not affect the Old-Age Security or Guaranteed Income Supplement (GIS) benefits you may be getting. As the homeowner, you are required to maintain your home and remain current on property taxes and homeowners insurance. To recap, the CHIP Plan is suitable for people who don’t want to move but would like to improve their monthly cash flow. With the CHIP Mortgage you always remain on title and retain ownership and control of your home.

The money received from the reverse mortgage can be accessed in one lump sum or in planned advances – it's your choice! If you have an existing mortgage or home equity line of credit, the funds received must first be used to pay off the existing loans secured by your home. The remaining cash can be used for whatever you like – here are some example of how customers of the CHIP Program have used their money:

  • Pay for home improvements or repairs
  • Cover your regular expenses
  • Pay for travel
  • Pay for healthcare expenses
  • Pay-off existing debts
  • Help your children with an early inheritance

To be eligible for the CHIP Program you must be:

  • A Canadian homeowner
  • Age 55 or older
  • The home must be your primary residence

Please note: If you have a spouse, both of you must be at least 55 years or older and you must both be listed on the CHIP Reverse Mortgage application

When you apply for the CHIP Program, we will consider the following factors:

  • Your property type, condition and appraised value
  • The location of your property
  • You and your spouse’s age

In general, the older you are and the more equity you have in your home when you apply for the CHIP Plan, the more money we should be able to lend you.

You are not required to make any payments on a CHIP Plan until you choose to move or sell your home. You are however, required to ensure that your property taxes and homeowners insurance are kept up to date. When you do decide to move or sell, the loan is repaid from the proceeds of the sale of the home. After the loan is repaid, all remaining money belongs to you and your estate. On average, CHIP customers have over 50% of the value of their home left to enjoy after repaying the loan. The exact amount will depend upon several factors, including: the value of your home, the amount of your loan, and the amount of time that has passed since you took out the loan.

There are several factors to consider before deciding to proceed with a reverse mortgage. As with any big decision, it’s helpful to speak to family and friends and fully understand the pros and cons of the reverse mortgage in Canada. Some of the pros and cons include:


You receive the reverse mortgage funds as tax-free cash and you can spend the money anyway you like!

You stay in the home you love and maintain ownership and control of your home. All you must do is maintain your property and pay your property taxes and homeowners insurance.
There are no monthly mortgage payments required until you decide to move or sell your home.

The CHIP Program is a non-recourse loan which means that at the time of repayment, you (or your estate) will never owe more than the fair market value of your home – as long as you have maintained your property taxes and insurance.

It is your choice how you receive the funds from the CHIP Plan. You can receive it all at once in a lump sum or in scheduled advances over time – its up to you!


Because there are no monthly mortgage payments required, interest rates for the CHIP Plan tend to be higher than that of a traditional mortgage option.
The balance of the loan increases over time as does the interest on the loan.

A reverse mortgage is a loan secured against the value of your home. It is designed exclusively for homeowners aged 55 years and older. It enables you to convert up to 55% of your home's value into tax-free cash. The funds from a reverse mortgage can be used for whatever you desire; to cover monthly expenses, renovate your home, pay-off debt or travel - the choice is yours! With a reverse mortgage, you maintain ownership of your home and there are no monthly mortgage payments required. Repayment of the loan is only required once you chose to move or sell. We guarantee that the amount you eventually repay will never exceed the fair market value of your home. And if your home goes up in value, the appreciation is all yours. You are simply required to maintain your property and pay the taxes and insurance.

To be considered eligible for a Reverse Mortgage in Canada, you must be:

  • A Canadian homeowner
  • Age 55 or older (if you have a spouse, both of you must be at least
  • 55 years old to be eligible)

To qualify for a Reverse Mortgage in Canada, the following factors are assessed:

  • You and your spouse's age
  • Location of your home
  • Type of home (e.g. detached, condo, townhouse etc.)
  • Appraised value of your home
  • The condition of your home
  • Your home equity
  • What is a reverse mortgage?
  • Getting a reverse mortgage is like staying in a nice hotel
  • Why is it called a reverse mortgage?
  • Cashing in equity without having to move out
  • What happens to the equity in your home?
  • How much could I take out with a reverse mortgage?
  • Will I still be able to leave an inheritance?
  • Types of Reverse Mortgage Rates
  • The benefits of the CHIP Reverse Mortgage
  • Frequently Asked Questions

Reverse mortgages have experienced huge growth over the last few years. This is partly due to the startling reality that almost a third of Canadians are going into retirement with no savings. Reverse mortgages are increasingly being used to boost retirement income. But what is a reverse mortgage, exactly?

A reverse mortgage is a loan that allows you to access some of your home’s equity. Many retired Canadians are house rich but cash poor; they’re struggling financially while sitting on an investment worth hundreds of thousands of dollars. A reverse mortgage allows you to cash in some of that investment, in the form of tax-free money in either a lump sum amount or regular advances – all depending on what suits you and your needs. To help you better understand, here's a video explaining what a reverse mortgage is.

Try watching this video on

To help explain this financial solution better, you can think about getting a reverse mortgage like staying in a nice hotel or resort.

When you check into a hotel, you provide a credit card that is used as collateral (security that proves you will pay your bill). You get to enjoy your room, the swimming pool and other amenities, room service and meals in the hotel’s restaurant, and you don’t pay a cent until you leave.
With a reverse mortgage, your home is used as collateral, allowing you to access some of the equity in it. You get to use the money from the loan to improve your lifestyle, pay off debts, go on vacation or renovate your home. And the best part is, you don’t have to pay back a cent until you move out or sell your home.

In a hotel there are people who will happily do lots of things for you, from bringing you the morning paper, to cooking your breakfast and doing your dry cleaning. With a reverse mortgage, you’ll have the extra funds to pay for snow clearers, gardeners and house cleaners, as well as dinners out at your favourite restaurants.

In the same way that a credit card allows you to stay in a nice hotel suite rather than a tiny motel room, a reverse mortgage allows you to stay in your home rather than having to sell or downsize.

With a conventional mortgage, borrowers take out a loan to buy their home and pay back the lender over a period of time. With a reverse mortgage, the lender makes payments to the borrower (the roles are reversed). The amount you receive is tax-free and you don’t have to make any scheduled repayments of principal or interest.

With 93% of Canadians determined to retire at home, while dealing with rising debt and an increased cost of living, a reverse mortgage is one of the best ways to stay in the home you love. You get to boost your retirement income without having to downsize.

Just as you can extend your stay in that nice hotel, thanks to your credit card, your reverse mortgage allows you to stay in your home longer. As with a conventional mortgage, the bank doesn’t take over ownership. You stay on title and own your home until you decide to move out or sell.

By taking out a reverse mortgage, you get to have access to some of the equity in your home now, when you need it, without having to sell or move. Like with a hotel stay, you get to enjoy all the benefits of the extra money now and don’t have to pay for it until you choose to leave.

As with any mortgage, your equity will be the value of your home less the amount of your loan. If you choose not to make any interest payments, the amount you owe will be calculated based on the time you stay in your home and the interest rate of your reverse mortgage.

The chances are that your home will also increase in value (on average, Canadian homes have increased in value by over 5% annually over the last 18 years).

For example, let’s say you take out a reverse mortgage of $200,000 and your home is worth $800,000 (leaving $600,000 in equity). Over five years, if house prices were to increase by just 3% every year, your home’s equity would rise from $600,000 to $650,300.1

Plus, HomeEquity Bank guarantees that you will never owe more than your home is worth when you decide to sell it. In fact, 99% of homeowners have money left over once their loan is repaid.

1 Based on an annual increase in value of 3%, the home’s value would be $927,419 after five years. Based on HomeEquity Bank’s five-year rate of 6.74% (as of Nov. 2018), the loan would be at $277,118 after five years. $927,419 - $277,119 = $650,300 in equity. House prices are not guaranteed to rise every year, however, and could fall in value.

Use our reverse mortgage calculator to work out how much of a reverse mortgage you could qualify for, or call a HomeEquity Bank reverse mortgage specialist now at 1-905-923-0818.

By tapping into some of your home’s equity now, the amount that you may have planned to leave for your children will be reduced, but for many people this is a small price to pay for being able to stay in their home and have financial independence.

Some of our customers even take out a reverse mortgage to provide an early inheritance, which allows them to give a substantial amount of money to their children at a time when they need it, rather than many years from now. This also allows them to see the impact this inheritance can make.

CHIP Reverse Mortgage rates are available in two different formats: fixed terms or variable terms. Variable term rates are determined by the HomeEquity Bank prime rate, which is directly influenced by the Bank of Canada prime rate. A variable rate may fluctuate up or down over the course of the term, which is why it is called “variable”. A fixed term rate, on the other hand, is set for a determined period, which is why it is called “fixed”. The CHIP Reverse Mortgage fixed term rates are available for a sixmonth, 1-year, 3-year or 5-year period. Clients typically prefer longer terms, such as the 5-year, but the choice is yours!

At the end of your reverse mortgage rate term, your renewal rate will be the interest rate that is posted here when your rate term expires. Let’s look at a couple of examples to understand reverse mortgage rates offered by CHIP.

Example 1 – 5-year reverse mortgage interest rate term

You have a home valued at $600,000 and you are approved for a CHIP Reverse Mortgage of $200,000. Remember, the amount we lend depends on several factors, such as your age, home value and location. If you decide to proceed, you will have a choice of reverse mortgage interest rate terms. Let’s say you choose the 5-year term. Your first term interest rate will be fixed at the interest rate found in the table above. At the end of the 5 years, you will check back on this website, and your renewal rate will be what is posted in the table at that time.

Example 2 – Variable reverse mortgage interest rate term

Let’s consider the same example: a home valued at $600,000 and $200,000 in CHIP money. For this example, you decide to take a variable term rate. Your initial interest rate will be the HomeEquity Bank prime rate plus the fixed spread – all outlined in the table above. If the Bank of Canada changes its prime rate, then more than likely HomeEquity Bank prime will change. Your variable rate would then change to the new HomeEquity Bank prime rate plus the fixed spread, which is guaranteed for a five-year period.

If you have any questions about the CHIP Reverse Mortgage rates or if you are interested in understanding more about Reverse Mortgage, you can contact us here. If you have any other questions, feel free to give us a call at 1-905-923-0818.

The freedom to retire in the home you love

Why choose CHIP?
  • Get up to 55% of the value of your home
  • Stay in your home
  • Maintain full ownership and control
  • Free yourself from monthly mortgage payments until you choose to move or sell
  • Option to make advance interest payments
Your retirement, your way
  • Pay off debts
  • Renovate your home
  • Take care of unexpected expenses
  • Help the ones you love
  • Enjoy the retirement you deserve
  • Travel
  • Purchase a vacation property
How to apply

The process is simple

1. Contact your broker

Contact your mortgage broker for more information about CHIP Reverse Mortgage.

2. Get an appraisal

Once you decide to proceed, your mortgage broker will help arrange for an appraisal of your home.

3. Fill out an application

Once we receive the appraisal, you’ll know exactly how much you are approved for. Just complete a dimple form confirm the amount of money you want, and we’ll answer any questions you may have

4. Speak to a lawyer

Before everything is finalized, we require you to review the information with an independent lawyer of your choice.

$. Get your money

You will receive your tax-fee money as a lump sum or multiple instalments.

What if I have an existing mortgage?

You can use the CHIP Reverse Mortgage to pay off your existing mortgage and free up cash flow for the things that matter to you.

What makes the CHIP Reverse Mortgage different from a Home Equity Line of Credit?

HELOCs are a good short-term borrowing option for people who can pay the interest and loan in the near future. However, HELOCs are callable loans and there exists significant risk of non-renewal or cancellation.

Will I ever owe more than my house is worth?

You keep all the equity remaining in your home. In our many years of experience, over 99% 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.

What fees am I responsible for?

There are one-time fees to arrange a reverse mortgage. Appraisal fees, a fee for independent legal advice, as well as our fee for administration, title insurance, and registration. Many of these fees are common with a conventional mortgage. With the exception of the appraisal fee, all fees are paid for with the funding dollars.

Should I consider this a loan of last resort?

No. Many financial professionals recommend a reverse mortgage to homeowners 55 and over who prefer to stay in their own home, want to eliminate their monthly mortgage payments, and supplement their monthly income with tax-free funds.