September 19, 2020

Details about the CHIP Home Income Plan

Ownership protection
Estate protection
Interest rates and  Set-up costs


       Available to homeowners 60 and older on their principal residence.

       Location and type of home must qualify.

       No medical, income or credit qualifications.


       Homeowners can access up to 40% of the current appraised value of their home based on the homeowner’s age and that of their spouse, and on the location and type of home.

       Funds are not taxed as income.

       Funds can be received in a lump sum or over time.  Most clients take a lump sum.

       Any outstanding loans secured by the home must be retired with the CHIP Home Income Plan funds.


       No regular payments are required.

       The full amount only becomes due when the home is sold, or if both homeowners move out.

       Clients have the option to repay the principal and interest in full at any time.

       Upon repayment, an interest rate differential may apply. A prepayment amount will apply on repayments within the first three years. This may be waived or reduced in the event of death or a move into a long-term care facility or retirement residence.

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Ownership protection

       With a CHIP reverse mortgage, title remains in the homeowner’s name and they will never be asked to move or sell to repay their Home Income Plan.

       The homeowner is responsible for up-to-date payment of property taxes, fire insurance and condominium/maintenance fees, and maintenance of the property.

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Estate protection

       In more than 20 years of our experience, over 99% of homeowners have equity remaining upon repayment.

       The amount to be repaid is guaranteed not to exceed the fair market value of the home at the time it is sold, protecting the homeowner or the estate.

In this illustration, home equity appreciates by 5.10% annually (Source: CREA, Canadian Real Estate Association, 15-year national house appreciation average, September 2009) with a CHIP Home Income Plan initial interest rate of 3.75%. These assumptions are not indicative of future market performance or interest rates. Actual results may vary.

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Interest rates and Set-up costs

       Clients may choose a fixed rate with a variety of terms, or a variable rate.

       Interest is added to the outstanding balance and is compounded semi-annually.

       Interest rate discounts are available that significantly lower the cost of borrowing.

       Set-up costs include a home appraisal, independent legal advice and legal & closing costs.

    Annual Percentage Rate (APR) *
Term Interest Rate 10 Years 5 Years 3 Years 1 Year
Variable 4.75% 4.88% 4.98% 5.11% 5.82%
6 months 4.90% 5.03% 5.13% 5.27% 5.97%
1 year 4.99% 5.12% 5.22% 5.36% 6.06%
3 years 5.90% 6.05% 6.15% 6.29% 7.00%
5 years 6.25% 6.41% 6.51% 6.65% 7.36%

* Annual Percentage Rate (APR) is based on a CHIP Home Income Plan of $150,000 and calculated as the rate of interest for the length of the plan plus closing costs.

Rates are subject to change and will be posted on this site.

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