Bloom Reverse Mortgage: Empowering Your Retirement with Home Equity
The Reverse Mortgage for Canadians 55 and over
Thousands of 55+ Canadians are beginning to realize just how wealthy they are, when they consider the equity they’ve built in their homes
- Access up to 55% of your home value in tax-free cash!
- Keep the home you love
- No monthly mortgage payments
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What is an Bloom Reverse Mortgage?
A Bloom Reverse Mortgage allows homeowners to tap into the equity they’ve built in their home. It’s a financial tool that enables you to convert a portion of your home’s value into tax-free cash, all while you continue to live in and maintain ownership of your home. Unlike a traditional mortgage, you’re not required to make monthly payments. Instead, repayment of the loan is deferred until you sell your home, move out, or pass away.
The Bloom Reverse Mortgage is a flexible option, with payment terms that fit your lifestyle and financial needs. You can access up to 55% of your home’s appraised value, and the funds are entirely tax-free. For more details, visit the Financial Consumer Agency of Canada.
Benefits of an Bloom Reverse Mortgage
- Access Up to 55% of Your Home’s Value: Depending on your age, home value, and location, you can unlock up to 55% of your home’s equity.
- No Monthly Payments: You do not need to make any regular payments. The loan is repaid when you sell your home or pass away.
- Tax-Free Cash: The money you receive from a Bloom Reverse Mortgage is tax-free and can be used for any purpose, such as paying off debts, covering living expenses, or funding healthcare needs.
- Stay in Your Home: With Bloom, you retain ownership of your home and can live there for as long as you wish. There is no need to sell or move out.
- Flexible Payment Options: Choose between receiving a lump sum, regular payments, or a combination of both, depending on your needs.
- No Negative Equity Guarantee: With Bloom’s no-negative-equity guarantee, you’ll never owe more than the value of your home when it’s sold.
How Does an Bloom Reverse Mortgage Work?
The Bloom Reverse Mortgage allows homeowners to borrow against their home’s equity without the need to make monthly mortgage payments. Here’s how it works:
- Eligibility: You must be at least 55 years old, and the home must be your primary residence.
- Home Appraisal: Bloom will conduct a professional appraisal to determine your home’s current market value. You can access up to 55% of your home’s appraised value.
- Receive Funds: Once approved, you can choose how to receive your funds—either as a lump sum, regular monthly advances, or a combination of both.
- No Monthly Payments: You won’t need to make any monthly payments. The loan is repaid when you sell your home or pass away, using the proceeds from the sale.
- Repayment: When the home is sold, the reverse mortgage and any accumulated interest are repaid from the sale proceeds.
Bloom also offers flexible solutions for repayment, making it easy to adjust to your financial needs.
For detailed information, consult the Government of Canada’s reverse mortgage guide.
Bloom Reverse Mortgage Eligibility
To qualify for a Bloom Reverse Mortgage, you must meet the following criteria:
- Age Requirement: You and your spouse (if applicable) must be at least 55 years old.
- Primary Residence: The home must be your primary residence, where you live for at least six months of the year.
- Home Value: Your home’s value will be appraised to determine how much equity you can access. Typically, older homeowners and homes in urban areas qualify for larger loan amounts.
Bloom Reverse Mortgage vs Other Reverse Mortgage Providers
| Bloom Reverse Mortgage | CHIP Reverse Mortgage |
|---|---|
| Up to 55% of home’s value available | Up to 55% of home’s value |
| No monthly payments required | No monthly payments required |
| Interest rates between 6% - 8% | Similar interest rates |
Bloom Reverse Mortgage Interest Rates 2024
The interest rates for a Bloom Reverse Mortgage are competitive within the reverse mortgage market. They are typically higher than traditional mortgage rates due to the deferred repayment nature of the loan. Bloom offers both fixed and variable interest rate options, allowing homeowners to choose the option that best suits their financial situation.
For the most current interest rate information, visit Bloom’s website or consult with a licensed mortgage broker.
To stay informed on mortgage rate trends, visit the Bank of Canada’s website.
You can also check the latest reverse mortgage rates by visiting one of Canada’s top rate comparison sites, Rates4u.
Who Should Consider an Bloom Reverse Mortgage?
A Bloom Reverse Mortgage is ideal for Canadian homeowners who are looking for a safe and secure way to supplement their income or cover unexpected expenses in retirement. Here’s why it may be the right choice for you:
- No Impact on Government Benefits: The funds from a Bloom Reverse Mortgage are tax-free, meaning they won’t impact your Old Age Security (OAS) or Guaranteed Income Supplement (GIS).
- Stay in Your Home: Unlike downsizing or selling your home, a reverse mortgage allows you to stay in your current home and enjoy your retirement without having to move.
- Flexibility in Payment Options: Bloom offers flexible payment options, allowing you to receive the money in a way that best suits your lifestyle and financial goals.
- Use the Funds for Any Purpose: Whether you need to cover medical bills, make home improvements, travel, or simply increase your monthly income, the money from your reverse mortgage is yours to use as you see fit.
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You can access up to 55% of your home’s appraised value, depending on your age, home value, and location.
No, the money you receive is tax-free and does not affect your Old Age Security (OAS) or Guaranteed Income Supplement (GIS).
No, you keep ownership as long as property taxes, home maintenance, and insurance are kept up to date.
You can access up to 55% of your home’s value, depending on factors like your age and home value.
No, reverse mortgage payments are tax-free, and they won’t impact your Old Age Security (OAS) or Guaranteed Income Supplement (GIS).
Expect costs like appraisal fees, legal fees, and administrative charges, which vary by lender.
Yes, you can sell your home at any time, but the reverse mortgage balance must be repaid from the proceeds.
Yes, most lenders allow early repayment, though penalties may apply depending on the contract terms.
Example: How a Bloom Reverse Mortgage Helped One Retiree
Case Study: Paul, Age 65
Paul was looking for a way to fund home improvements and increase his monthly income without selling his home. With a Bloom Reverse Mortgage, he was able to unlock 45% of his home’s value and receive a lump sum of tax-free cash. Paul used the money to complete home renovations and boost his retirement income, all while staying in the home he loves.
Understanding Reverse Mortgage Costs With Bloom
Reverse mortgages include several costs beyond the interest rate:
- Processing Fees: Charges for setting up the mortgage, which may be a flat fee or based on the loan amount.
- Closing Costs: Fees associated with finalizing the mortgage, such as legal and administrative fees.
- Independent Legal Advice (ILA): Some lenders require you to obtain legal advice, which can cost between $350 to $500.
Why Are Interest Rates Higher for Reverse Mortgages with Bloom Reverse Mortgage?
Reverse mortgages pose more risk to lenders since repayment isn’t required until the future, and borrowers make no monthly payments. To offset this risk, lenders charge higher interest rates compared to traditional mortgages.
How Is Interest Calculated on a Reverse Mortgage with Bloom Reverse Mortgage?
Interest is only charged on the amount you borrow, not the maximum amount available. It accrues daily and is compounded semi-annually for fixed rates or monthly for variable rates.
Example Calculation
- Home Value: $500,000
- Borrowed Amount: $100,000
- Interest Rate: 4.89% annually
Steps:
- Daily Interest Rate: 4.89% ÷ 365 = 0.0134% per day
- Daily Interest Charge: $100,000 × 0.0134% = $13.40
- Interest Over Six Months: $13.40 × 180 days = $2,412
- New Balance After Six Months: $100,000 + $2,412 = $102,412
- Compound Interest: Interest now calculated on $102,412
After one year, the total interest accrued would be approximately $4,900, and the loan balance would be around $104,900.
How is compound interest applied on Reverse Mortgages?
After six months, compound interest takes effect, meaning the interest is charged not just on the principal loan but on the accumulated interest. For example:
- Second six-month daily interest: $102,444 x 0.01358% = $13.91/day.
- Interest for another six months: $13.91/day x 180 days = $2,504.
Adding this to the outstanding balance of $102,444 gives a new loan balance of $104,948.
Thus, after one year, the total interest would amount to $4,948 on a $100,000 reverse mortgage with a 4.89% interest rate.
Bloom Reverse Mortgage Rates
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Contact Us for More Information on Bloom Reverse Mortgage
Interested in learning how a Bloom Reverse Mortgage can help you unlock your home’s value and secure your financial future? Contact us today for a free consultation and see how much equity you can access.
Citadel Mortgages is one of Canada’s leading brokerages specializing in reverse mortgages. Visit Citadel Mortgages to learn more today.
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Unlock the value in your home and turn it to cash to help you enjoy life on your terms. Inquire about your reverse mortgage today.
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Reverse Mortgage Calculator: Estimate How Much You Can Borrow
Are you curious about how much you could access from your home equity with a reverse mortgage? Use our simple and intuitive Reverse Mortgage Calculator to get an estimate of how much you could borrow based on your home’s current value, your age, and other factors. This tool can help you better understand your financial options and decide whether a reverse mortgage is right for you.
How the Reverse Mortgage Calculator Works:
- Enter Your Home’s Current Value: The estimated market value of your property.
- Select Your Age: The older you are, the more you can borrow. If you have a spouse, include both ages.
- Choose Your Location: Property location affects your borrowing power, as home values vary by region.
- See Your Estimated Loan Amount: The calculator will provide a projection of the maximum amount you may qualify for.
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