Extend client portfolios and your book with a CHIP Reverse Mortgage

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In an environment of rising inflation and volatile financial markets, your affluent, retired clients are looking for solutions to help with their cash-flow needs. But they also have other priorities, such as keeping their investment portfolios intact, maximizing the value of their estate and minimizing taxes. These goals can sometimes conflict, as some of your clients may be tempted to cash out investments to fund more immediate lifestyle needs. Although understandable, selling investments in a volatile market can lock in losses, reduce the value of your client’s estate and lead to taxable events. 

Reverse mortgages: A holistic wealth planning solution

Your affluent clients will look to you for guidance and advice on how to meet all of their wealth planning goals. The good news is there is a way to get in front of your clients’ needs and retain their assets under management: The CHIP Reverse Mortgage by HomeEquity Bank. With this flexible planning tool, Canadians 55+ can access up to 55% of their home’s value in tax-free cash. Monthly mortgage payments aren’t required until they move or sell, which frees up additional cash. In other words, with a reverse mortgage, the client’s home pays them. Plus, they get to stay in the home and community they love.

Your clients don’t have to take the full amount of the reverse mortgage they qualify for; they can tactically access funds whenever the need for tax-efficient cash flow arises. These funds can be used to meet various needs, including funding retirement lifestyles, building investment portfolios, purchasing a property or helping children with a down payment on their home.

Your clients may already be thinking about the advantages of a reverse mortgage – HomeEquity Bank funded $1 billion in new mortgages in 2021, much of that originating directly from individuals.

Help keep client portfolios intact

Even though home prices have dipped recently, many of your clients have probably benefited from substantial home-price appreciation over the past few decades. But this equity can be difficult to access for those who don’t want to sell their homes. With a CHIP Reverse Mortgage, up to 55% of home equity becomes accessible. Clients maintain full ownership of their home and don’t have to make mortgage payments until they move or sell.

Your clients’ investment portfolios are the other major component of their net worth. However, selling non-registered investments to access funds can trigger taxable events, as can increasing withdrawals from registered plans. Helping your clients meet their cash flow needs with a CHIP Reverse Mortgage means that more of their investments continue growing on a tax-deferred basis. This provides stability for clients who are living longer lives and want to enhance their estate for their heirs.

Delivering flexible solutions that provide your clients with tax-free cash flow also helps to preserve your accounts and assets under management. 

To learn more about how the CHIP Reverse Mortgage fits in your clients’ financial plans, visit us online or contact a Business Development Manager today.

Michelle Schriver

Michelle is Advisor.ca’s managing editor. She has worked with the team since 2015 and been recognized by the National Magazine Awards and SABEW for her reporting. Email her at michelle@newcom.ca.