The last mortgage you should have before you retire

The pandemic has taught us many things. Some of them are changing the next generation. Access to money and housing were profoundly changed.  We learned that the government could reduce interest rate beyond what we had seen before and owning a home large enough to live and work created an epic run-on real estate.  

Re-advanceable mortgages give you access to cashflow when you need it.

Young families sought solace in a home but retirees have remained in their homes,  opting out of downsizing and retirement homes. Generations have sold their largest  asset their homes to help top up or fund retirement. Holding on to your home for years  longer has created unique cashflow and retirement issues. Armed with tremendous  equity, getting a mortgage without robust incomes to qualify with stress test  benchmarks and higher interest rates has left many scratching their heads, as they  thought owning your home was the best way to enter retirement.  

Maintaining your lifestyle in retirement may mean accessing equity in your home and  not downsizing. Setting up the right mortgage in your maximum earning years is key. A  re-advanceable mortgage that allows you to get cash at the lowest cost, anytime you  want it. If you still have a mortgage a re-advanceable mortgage increases the line of  credit portion available to you as you pay down the principal. It’s automatically built in.  

So why would you need a large line of credit moving into retirement? You may want to  supplement fixed incomes and not want to sell your home or downsize. You may want  a vacation or second property or lend money to children for their first home. Having a  

re-advanceable mortgage that has a portable option, allows you to move the mortgage  with you if you move. It may also have the “right of survivorship” which can become  very important when one member passes away. With some big banks, if one spouse  passes away, your line of credit will be taken away and you will have to qualify on one  income, that may just be a fixed income which will not qualify for much.  

Without a re-advanceable mortgage that gives you access to your equity when you  want it, you may be forced to get a private mortgage or a reverse mortgage at higher  rates to get access to your home equity.  

Not all mortgage are crated equal. Give me a call today and we can review your best  options. Keeping your home and having access to money when you need it at low  rates is something we no longer take for granted.