Mortgages by Mellisa Helps Seniors Achieve Financial Security

Tapping into the Value of Your Home

Mellisa Thornton is a Level 2 Licensed Mortgage Agent with Pineapple Mortgage. Through her platform, Mortgages by Mellisa, she works directly with seniors and their families to unlock home equity through reverse mortgages. This is a key financial tool that allows homeowners aged 55+ to tap into the value of their homes without needing to sell or make monthly payments.

What is a reverse mortgage?

A reverse mortgage is a financial tool that allows homeowners aged 55 and older to access the equity in their home without having to sell or make monthly mortgage payments. Instead of making payments to the lender, the lender makes payments to the homeowner as a lump sum, regular payments, or a line of credit. It is a helpful option for seniors who want extra money in retirement while staying in their own homes.

What's the biggest misconception about reverse mortgages?

Many people believe that you lose ownership of your home with a reverse mortgage, but that’s not true. You stay the owner and can live in your home as long as you want. With a reverse mortgage, you remain the full owner of your home. You stay in your home for as long as you want, until you move, enter long-term care, or pass away. At that point, your estate typically has 6 to 12 months to decide what to do with the property.

Another common misconception is that needing a reverse mortgage is something to be ashamed of. It’s not. Seniors today have built up a lot of home equity, and there’s nothing wrong with using it to live more comfortably, pay for care, or enjoy a nice retirement. It’s your money, and you deserve to spend it.

What happens to the property if someone becomes mentally incapable?

If one spouse becomes mentally incapable and the couple owns the home together, the other spouse can continue living in the home without any issue. If the person is single, a Power of Attorney (someone legally appointed to make decisions) can manage the property on their behalf. As long as the homeowner still lives in the home, they have the right to stay there as long as they want, regardless of mental capacity.

How does a reverse mortgage work when you sell your home?

When you sell your home, the reverse mortgage must be repaid. You (or your lawyer) request a discharge statement from the lender, which shows the total amount owed. After the home is sold, your lawyer pays off the reverse mortgage using the sale proceeds. Any remaining money goes to you, your Power of Attorney, or the executor of your estate, depending on the situation.

What are some ways to receive the payment of a reverse mortgage?

With a reverse mortgage, you can choose how to receive your money, because it’s your equity. Once approved (up to 55% of your home’s value), you can receive the funds:

• As a lump sum
• In monthly or bi-monthly payments
• Biannually
• A combination of these

How is the value of your home determined?

To calculate how much you can borrow through a reverse mortgage, the lender needs to assess your home’s value. This can be done in one of two ways: an online market review or a home appraisal, which the lender arranges at no cost to you. Once the home’s value is confirmed, the lender uses it to calculate your maximum eligible amount.

What is different about reverse mortgages in the US vs. Canada?

Reverse mortgages sometimes get a bad reputation, usually due to past issues in the U.S. and the U.K. But in Canada, the system is much more regulated and built to protect the homeowner.

Here’s what makes Canadian reverse mortgages safer:

• They are offered only by federally regulated lenders
• Two lawyers are involved in every transaction: One for the mortgage process and one providing Independent Legal Advice (ILA) to protect the client
• The client must fully understand the terms before anything is finalized

Who is eligible for a reverse mortgage?

In Canada, any homeowner aged 55 or older is eligible to apply for a reverse mortgage. This applies nationwide, with only minor differences in some provinces like B.C. and Alberta. However, the younger you are, the less you qualify for. For example, someone who’s 57 may be approved for a smaller percentage than someone who’s 70, ensuring they don’t outlive their home equity. The ideal age range for reverse mortgages is typically between 66 and 76, when many homeowners are looking for ways to boost retirement income while staying in their homes.

What are the benefits of a reverse mortgage vs. a home equity line of credit?

Both a reverse mortgage and a home equity line of credit (HELOC) let you access your home’s equity, but they work very differently. Here are the key benefits of a reverse mortgage:

• No Monthly Payments

With a reverse mortgage, you don’t have to make monthly payments. A HELOC requires minimum payments every month.

• Easier to Qualify

To qualify for a reverse mortgage, you just need to show you can cover property taxes and insurance. For a HELOC, you must pass a full income and credit check, similar to a traditional mortgage.

• No Need to Requalify

A reverse mortgage is locked in for life, and you don’t need to reapply. HELOCs may require requalification in a few years, and the lender can reduce or cancel your limit.

• No Impact on Credit

Since reverse mortgages don’t involve payments, missing a payment isn’t possible, which won’t hurt your credit score. Missing a HELOC payment, however, can damage your credit history.

How do interest rates affect reverse mortgages?

Reverse mortgage interest rates are usually lower than a home equity line of credit and slightly higher than a regular mortgage, by about 0.5% to 1%. As of now, regular mortgage rates are around 5%, while reverse mortgage rates are typically in the low 6% range. Just like a regular mortgage, reverse mortgages come with term options (2, 3, or 5 years). If rates change, you can discuss with your mortgage agent about renewing or switching lenders at the end of your term. This makes reverse mortgages more cost-effective for seniors.

How does a reverse mortgage change over time?

A reverse mortgage stays in effect for as long as you live in your home. It only needs to be repaid when you move out permanently, sell the property, or pass away. The home and the money remain yours throughout that time. If you pass away sooner, less interest accumulates because the loan was active for a shorter period. However, if you live longer, the interest will build over those extra years. During that same time, the value of your home is also likely to increase. For example, home prices in 2004 were significantly lower than in 2024. So, while interest accrues over time, the natural appreciation of your home can help offset those costs.

Who is responsible for the debts of the homeowner?

With a reverse mortgage, you will never owe more than the value of your home, due to how the loan is structured. Since you can only borrow up to 55% of your home’s value, there's a built-in safety net. Even in the unlikely event that the housing market drops significantly, reverse mortgage lenders in Canada include a market value guarantee. This ensures that your estate will not be left with debt beyond the home’s worth. When the homeowner passes away or moves out, the lender will assess the home’s current market value. The executor or beneficiary of the estate will then work with the lender to repay the loan using the proceeds from the sale.

How to invest proceeds of a reverse mortgage?

Although mortgage agents like Mellisa don’t offer investment advice directly, she works closely with trusted financial planners and partners who help seniors invest wisely while protecting their benefits. One key consideration is to ensure that any investments made don’t negatively affect government income supports like CPP (Canada Pension Plan) or OAS (Old Age Security). A knowledgeable planner can help structure the funds in a way that allows you to grow your money without losing access to essential retirement benefits.

Can older seniors get a reverse mortgage?

There is no upper age limit for a reverse mortgage. As long as you are 55 or older and own your home, you’re eligible to apply. Many older seniors use reverse mortgages to improve their quality of life later in retirement. For Mellisa, the oldest client she has helped was 92, and the youngest was 56. More and more people are rethinking retirement, and a reverse mortgage can offer the flexibility and financial freedom to support that. Even if you’re 94 or 99, you can still qualify, as long as the home is in your name.

Can a Power of Attorney (POA) instigate a reverse mortgage?

Yes, a POA can apply for a reverse mortgage on behalf of a homeowner who is unable to manage the process themselves due to cognitive decline or other health issues. This is especially helpful for members of the “sandwich generation” who are balancing care for aging parents and young families while trying to manage finances and support systems.

In these cases, the POA can fully handle the reverse mortgage application and transaction. To ensure clarity and protection for all, it is recommended that the POA attend the Independent Legal Advice (ILA) meeting with the homeowner. This ensures both the homeowner and POA fully understand the terms and responsibilities of the agreement before proceeding.

How to contact Mellisa and learn more about reverse mortgages?

Mellisa is available to help seniors and families across Canada with reverse mortgage solutions. Whether you're just starting to explore your options or ready to apply, she is here to guide you through every step of the process. She can assess what you qualify for, gather a few basic documents, and get the process started. It’s quick, simple, and stress-free.

📧 Email: [email protected]

📞 Call: 416-434-0634