The reverse mortgage product category as offered in a few other countries appears to be seeing a new degree of interest in foreign nations, particularly in Canada and Australia. This is according to recent international coverage of reverse mortgages available in those countries.
HomeEquity Bank, the premiere bank offering reverse mortgages to Canadian seniors at or over the age of 55, recently reached a milestone in the valuation of its reverse mortgage portfolio according to Canadian business news outlet MortgageBrokerNews.ca.
“HomeEquity Bank has revealed that its portfolio of reverse mortgages under administration recently surpassed $5 billion [CAD] for the first time,” the outlet reported this month. “The lender credited ‘strong market dynamics’ for the growth, adding that the reverse mortgage sector ‘is poised to grow by another $1 billion dollars in 2021 alone.’”
HomeEquity Bank EVP and CMO Yvonne Ziomecki described for the outlet why the business appears to be poised for relatively rapid growth, while also saying that older Canadians are demonstrating their desire to remain in their own homes.
“We’ve conducted a number of national surveys over the past year, and we’ve found that more than a quarter of homeowners 55-plus would consider tapping into their home’s equity to help fund retirement,” Ziomecki told the outlet. “Not only that, but 45% of older homeowners say leveraging the equity in their homes should be a core component of retirement planning.”
The success and reaching the milestone also serves as a testament to the company’s dedication, according to CEO Steven Ranson.
“Since our founding, the goal has always been to help Canadian homeowners enjoy retirement on their terms through lending solutions that fit their individual needs,” Ranson told the site. “This record-setting growth demonstrates the appetite for reverse mortgage products is growing as millions of homeowners 55 and older are recognizing the tremendous value and flexibility they provide.”
In Australia, a financial columnist received a question about that nation’s various reverse mortgage offerings, describing that nation’s reverse mortgage offerings as specifically designed to assist homeowners with more equity than they have cash on hand.
“The whole point of any form of reverse mortgage is to help asset-rich, cash-strapped seniors draw on the savings in their home to fund their retirement,” writes columnist Noel Whitaker in the Sydney Morning Herald. “You can live in your home for as long as you want (i.e. you have guaranteed occupancy), do not have to make regular repayments and can improve your retirement funding and standard of living.”
All commercial lenders in the reverse mortgage space (save for the Australian government’s Pension Loans Scheme) have been re-regulated, Whitaker says, which has added notable consumer protections for Australian seniors.
“It is important that you and your solicitor are fully aware of these,” he writes. “An issue for you may be that the property is held as tenants in common. Confirm upfront if this is acceptable to the lender.”