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Equitable Bank Reverse Mortgage Review

    Established in 2016, Equitable Bank is a digital bank that offers a wide variety of financial services in a non-traditional way, as everything is conducted online or over the phone. With this, they can pass on their operational savings from not having “brick and mortar” locations to their customers via lower interest rates and no service fees.  A reverse mortgage is a type of loan linked to a mortgage that is generally geared toward older homeowners.

    It is typically secured by residential property and transfers the equity that currently exists in a home into an added source of funds. Should a person require money to go on a vacation, support family members, pay off debt, or make home renovations, a reverse mortgage can offer access to that money so it can help cover these expenses, but still allow an individual to retain home ownership and the funds are offered tax-free. The reverse mortgage loan is paid back when the home is sold, or the last borrower passes away; therefore, no payments are needed on this right away. However, some people do make payments along the way, as more interest will be owed at the end of the loan term, which could create less equity in the home when it is sold.

    As such, Equitable Bank offers reverse mortgages to eligible clients that fit certain criteria. You might be eligible for a reverse mortgage if you are a Canadian aged 55+, live in a major city in Ontario, Quebec, British Columbia, or Alberta, live in your house for 6+ months each year, and the value of your home is at least $250,000. All residence titleholders must apply for this mortgage loan as joint borrowers. It is important to note that the minimum borrowing amount is $25,000, and you can currently access up to 55% of your home’s equity. Equitable Bank also offers one of the lowest interest rates on reverse mortgage loans across the country, as well as flexible repayment options, and several possibilities when it comes to your reverse mortgage payout advance. 

    What is the first step? Equitable Bank offers a tool on its website called the “Reverse Mortgage Calculator”. It takes mere moments to enter all the information needed, and clients instantly gain an estimate of the funds available. 

    The next step is talking to one of their Reverse Mortgage Specialists (RMS) dedicated to answering client questions and helping with the application process. Equitable Bank offers its customers two options for this: individuals can either reach out directly to them or be linked to an RMS by filling out a personal information form on their website.

    A Reverse Mortgage Specialist from Equitable Bank can help determine a borrower’s eligible loan amount, assist in choosing an adjustable or fixed interest rate, walk clients through the process of changing the type of mortgage held and the interest rate term, as well as offer advice on how payout advances are conducted.  

    There are three ways customers can gain access to their reverse mortgage funds. For those who decide they want to take out the maximum eligible amount, they can receive this money upfront, in a one-time lump sum, which may offer lower interest rates. Borrowers can also set up recurring payouts; however, it’s important to note that the initial advance needs to be a minimum of $25,000. Recurring advances are only available under an adjustable interest rate term and can be scheduled for monthly ($500) advances, quarterly ($1,500), semi-annually ($3,000), and annually ($6,000) payouts for up to 20 years. Single advances can be paid out on request, anytime after the reverse mortgage has closed. A minimum of $5,000 can be taken, or the entire remaining amount if there is less than $5,000 remaining.

    The application process for Equitable Bank’s reverse mortgage is straightforward and simple. RMS can help clients along the way, and some documentation will be needed, such as supporting statements if a borrower has debt secured to the house, any related mortgage information linked to secondary properties, verification around covering property-related expenses (i.e. condo fees, property taxes, etc.), and Power of Attorney verification, if this is applicable. The home will also need to get appraised by an accredited home appraiser to help figure out the market value of the house, which ultimately determines the amount that clients are eligible to borrow.

    Lastly, Equitable Bank offers added online tools to help clients decide whether a reverse mortgage is a viable financial solution. From a digital downloadable brochure to a FAQs page on their website, as well as Funding Process Guide and Independent Legal Advice FAQs, they provide several online resources to assist with this decision.

    For more information, visit the Equitable Bank .

    Christopher - BSc, MBA

    With over two decades of combined Big 5 Banking and Agency experience, Christopher launched Underbanked® to cut through the noise and complexity of financial information. Christopher has an MBA degree from McMaster University and BSc. from Western University in Canada.

    Christopher - BSc, MBA

    Christopher - BSc, MBA

    With over two decades of combined Big 5 Banking and Agency experience, Christopher launched Underbanked® to cut through the noise and complexity of financial information. Christopher has an MBA degree from McMaster University and BSc. from Western University in Canada.