As you’re undoubtedly aware, the holiday season can be a very expensive time. Not only are there gifts to buy, but there can be a host of hidden extra expenses – gift wrapping, postage, and more take-out meals than normal for a start.
It’s therefore no surprise that many Canadians find themselves struggling to afford these extra costs; many wind up paying for the holiday season with their credit card. According to a study by lowestrates.ca, 63% of Canadians expect to do this, with just over half of those carrying the balance into the new year.
And since credit cards have some of the highest interest rates around, they can easily lead consumers into a spiral of debt. Today almost a third of Canadians have outstanding credit card debt.
how a chip reverse mortgage can help
If you’re worried that you’ll overspend on your credit card this holiday season, the CHIP Reverse Mortgage could be for you. The CHIP Reverse Mortgage is a financial solution for Canadians over the age of 55 that allows you to access up to 55% of your home’s value in tax free cash.
The money can be used for whatever you want. This could include consolidating debt – including credit cards – renovating your home, or increasing cashflow at certain times of year, such as the holiday season.
Lower Interest Rates:
The CHIP Reverse Mortgage has a number of benefits over regular credit cards, with the first being lower interest rates. While credit cards can have interest rates between 12 and 23%, the CHIP Reverse Mortgage has rates of 4-7%. If you are using a credit card and don’t pay it off in full, the holidays could cost you less if you used the funds from a reverse mortgage instead.
No Monthly Repayments:
Another advantage the CHIP Reverse Mortgage has over credit cards is that it doesn’t require monthly repayments. When you take out a Reverse Mortgage, you don’t have to pay anything until you leave your home.* Without the need for monthly debt repayments, your monthly cashflow will increase, helping you avoid starting the new year with holiday debts to pay.
Cover the Cost of the Holidays for Years to Come!
The CHIP Reverse Mortgage doesn’t have to support your cashflow only this holiday season, but funds can be drawn on time and again when needed.
For example, say you initially took out the CHIP Reverse Mortgage for $25,000, then later down the road you wanted to enjoy some more of the cash in your home. Provided there’s enough equity left, you can take a subsequent advance of a minimum of $5,000 – all without repaying the initial amount first. As with the initial lump sum, this money can be spent on whatever you want, whether that’s covering the costs of future holiday seasons, completing long wished-for home renovations, or supporting adult children with the down payment for their own home.
The holidays can be a stressful time, especially if you feel you have to use your credit card to cover the costs – costs which are often carried into the new year. With the CHIP Reverse Mortgage, however, you can pay for the holidays this year and for years to come, relaxed in the knowledge that you’re enjoying lower interest rates and don’t have to pay back what you borrow until you leave your home.
For further details and to see how the CHIP Reverse Mortgage can help you, please contact your DLC Mortgage Professional.
*You must continue to pay your property taxes and insurance and maintain your home in good condition.
Written By: Agostino Tuzi
Post Sponsored by HomeEquity Bank