Contrary to popular belief, the percentage of seniors and retirees who choose to take out reverse mortgages in Ontario is steadily increasing. If you’re interested in discovering a few of the key reasons why seniors are electing to take out mortgages later in life, simply continue reading to discover a handy guide to mortgages for seniors.
A guide to mortgages for seniors.
Why some seniors choose to take out mortgages in order to fund their investment schemes:
You may be curious as to why some seniors who have fully paid off their homes, choose to take out brand new mortgages. One of the key reasons why a growing portion of seniors are choosing to take out new mortgages is to invest the money which they borrow in a fixed rate investment, which will yield more than their mortgage payment.
Examples of individuals who are drawn to such a practice include seniors who want to ensure that they’re able to enjoy their twilight years in comfort and seniors who are investment savvy and are confident investing in investment options which offer a competitive projected rate of return.
Alternatively, some seniors choose to take out new mortgages in order to renovate or maintain their homes or to assist their family members such as their adult children or grandchild in purchasing their first homes.
Another reason why a growing percentage of seniors take out a mortgage is that there is a growing percentage of seniors who retire with debt. In fact, the average senior family which has accumulated debt has around $25,000 in debt. Furthermore, the percentages of seniors who have outstanding debt upon retirement has doubled since 1999. To get the best mortgage rates in Collingwood contact us to get you the best rates available.
Canadian Home Income Plan (CHIP) Mortgage Ontario
Valuable advice for seniors who are seriously considering taking out a brand new mortgage:
1. Opt for a mortgage which boasts a low-interest rate and a lengthy term
Ideally, seniors should opt for a mortgage plan which offers the lowest interest rate and the longest term available, in order to receive the best possible value for their money. As an added bonus, if you take out a mortgage in order to make a profit from wise investments,
2. Make sure that taking out a loan won’t negatively affect your quality of life
If your regular mortgage payments will prevent you from being able to confidently enjoy your twilight years, make sure to think twice before signing on the dotted line and committing yourself to a new mortgage.
As an example, if your mortgage repayments don’t leave you with enough cash to spend time with your friends and family members, you may want to rethink whether or not the mortgage plan which you’re interested in signing leaves you with enough disposable to lead a comfortable life.
3. Keep in mind that trying to earn an income by investing money which you’ve sourced from a mortgage can be risky
While the vast majority of senior citizens who opt to take out a mortgage successfully make a profit from investing the money which they receive when they take out their mortgage, there is a risk that if interests rates rise or that the investments you make lose their value, you could end up making a loss.
So it’s definitely worth completing adequate research into the investments which you’re interested in making before choosing to take out a mortgage. As if you plan on securing your future mortgage against your family home, which you’ve spent decades paying off, you want to be confident, that there is little chance of losing the home, which you’ve worked hard to pay off.
4. Talk to our team about your mortgage options in order to score the best possible deal
If you want to ensure that you sign a mortgage deal which will offer you the best possible value, it’s well worth talking to a friendly member of our team, who’ll be able to give you all the advice which you’ll need in order to negotiate the best reverse mortgages in Ontario possible.