Are you a homeowner in Canada over the age of 55 looking to borrow against the equity in your home? If so, you may be considering a reverse mortgage. But can you get a reverse mortgage on a condominium in Canada? The answer is yes, but there are certain requirements that must be met. In this article, we'll explore what you need to know about obtaining a reverse mortgage on a condominium in Canada and how a mortgage broker can help you navigate the process.
Reverse Mortgage Re-Cap
A reverse mortgage is a financial product that allows homeowners to borrow money against the equity in their home, with the loan usually being repaid when the borrower sells the property or passes away. A reverse mortgage is an option for homeowners 55 and older residing in their home as their primary residence in Canada.
Reverse Mortgage on a Condo
So, the answer to the question "can you get a reverse mortgage on a condo in Canada?" is yes, it is possible to get a reverse mortgage on a condominium in Canada. However, there are some specific requirements that must be met in order for a condominium to be eligible for a reverse mortgage.
As a prerequisite, the condominium must be the borrower's primary residence. It cannot be a rental property or a vacation home, and it must be a self-contained unit with its own kitchen and bathroom.
Reverse mortgages are not available for all condominiums. Due to the nature of their ownership structure or the terms of their condominium corporation's bylaws, some condominiums, particularly those that are part of larger complexes or developments, may not qualify for a reverse mortgage.
A lender's decision to lend or not on a property ultimately rests with them.
When determining whether a condominium is eligible for a mortgage, the lender will examine the condominium corporation's bylaws and financial statements, as well as the borrower's financial situation.
To determine how much money can be borrowed, the lender requires an appraisal of the condominium's value. Typically, 55% of the value can be borrowed.
In Canada, a reverse mortgage can be obtained on a condominium, but certain requirements must be met in order for the condominium to be eligible. You should work with a mortgage broker, like us, who has experience with reverse mortgages for condominiums if you are considering a reverse mortgage. We can provide you with an understanding of the specific requirements and limitations associated with a reverse mortgage on your specific condominium.