Going Into Retirement Without a Mortgage
November 1, 2011 · Print This Article
If you are concerned about taking out a mortgage during retirement, don’t worry. Only 65% of retirees go into retirement with a paid-off house. While the dream is to pay off your house before you reach retirement age, with obligations such as kids, school, and moving between jobs many of us don’t get that far.
Don’t Put off Retiring Because You Have More to Pay on Your House
Canadians won’t retire unless they can meet all of their expenses, including mortgage payments. What if you could pay off your house so that you wouldn’t have to make regular payments? Would that mean that you could retire earlier? Most Canadians would answer yes to that question.
That’s why the CHIP Home Income plan makes so much sense. If you can wipe out your monthly or bi-weekly mortgage payments, you may be able to retire right now. If you have enough equity in your home to qualify for the CHIP Home Income plan, and you plan to stay in your house for the duration of your retirement, this is the way to doing it earlier.
Why Would You Want to Retire Earlier?
You can probably come up with these reasons on your own for the most part, but you may also have gotten used to the idea of retiring at a certain age. Wouldn’t you like the freedom to travel while you are still young and healthy, without expensive medical insurance or medical concerns? How about extra time to spend with your grandchildren while they are still young? The reasons to retire early if you have the ability to do so are very compelling.
I’m Interested, but I’m Really Fuzzy on Reverse Mortgages
No need to be. They are perfectly legal in Canada and we wouldn’t be able to offer them if there was anything wrong with the deal. In fact, as part of the process of taking out a reverse mortgage, you must consult a legal professional so that you ensure that your interests are being taken into account by a third party.
Will my Institution Accept a Payout?
This is something you have to find out from your current mortgage holder. There may be penalties that you have to pay if paying off your mortgage in full before the maturity date. If this is the case, talk to your financial institution about the issue to see what you can do in terms of a reduction in penalties. If they don’t offer you the answers you want, consult a mortgage broker or agent to see about a mortgage that will allow you to pay it off in full. You may even find yourself getting a better interest rate in the process of shopping around.
Without a mortgage, the only thing that you’ll be paying for on a month-to-month basis will be food, property tax and your utility bills. Think of the kind of freedom that would bring and the places you could go. The CHIP Home Income plan can help you do all of this. Contact us today to find out how.