Benefits of the CHIP Program
The CHIP Program is designed for Canadian homeowners age 55 years and older who want to live retirement on their terms. If you’re like most Canadian homeowners 55+, much of what you own fits into two categories – the equity in your home and the money you have saved. It is likely that the value of your home has grown over the years and makes up a large portion of your net worth. And while it is positive that your home has built value – this value is not accessible unless you decide to sell your home. The CHIP Program allows you to access up to 55% of its value without having to sell your beloved home. And best off all, you don’t have to make regular mortgage payments until you eventually move or sell. Additionally, the money you borrow is tax-free and it does not affect the Old-Age Security or Guaranteed Income Supplement (GIS) benefits you may be getting. As the homeowner, you are required to maintain your home and remain current on property taxes and homeowners insurance. To recap, the CHIP Plan is suitable for people who don’t want to move but would like to improve their monthly cash flow. With the CHIP Mortgage you always remain on title and retain ownership and control of your home.
How can you use the CHIP Program?
The money received from the reverse mortgage can be accessed in one lump sum or in planned advances – it’s your choice! If you have an existing mortgage or home equity line of credit, the funds received must first be used to pay off the existing loans secured by your home. The remaining cash can be used for whatever you like – here are some example of how customers of the CHIP Program have used their money:
- Pay for home improvements or repairs
- Cover your regular expenses
- Pay for travel
- Pay for healthcare expenses
- Pay-off existing debts
- Help your children with an early inheritance