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Turn home equity into retirement cash
House mostly paid off but monthly cash is tight? See how much a line of credit or a reverse mortgage could give, the monthly cost, and what you'd owe in 10 years.
1. Home equity line of credit (HELOC)
Could release up to about
$650,000
- About $433/month in interest on this amount
- Lower rate, but you pay interest monthly and need to qualify on income (pensions and investment income count).
2. Reverse mortgage (55+)
Could release up to about
$284,000
- No monthly payments; repaid when the home is sold or the parents move.
- Interest compounds: about $218,902 owed after 10 years.
Monthly income until what age?
Want to use your home’s value during your lifetime? Pick an age to see roughly how much you could receive each month, what you would owe and what would be left.
About per month (until 95)
$564
About $6,773 a year
Owing at age 95
$1,057,227
Home worth about $1,922,231; left over
$865,004
Estimate: assumes the balance reaches about 55% of the home value at that age, interest compounded semi-annually. Lenders set actual monthly limits by age, and prices may not rise. By contract you never owe more than market value.
Before you decide
- A reverse mortgage has no monthly payments, but interest keeps adding up and eats into the equity you leave to family; talk it over with them first.
- Also compare downsizing: sell and buy something smaller, and the difference costs no interest.
Estimate: HELOC up to about 65% of value; reverse mortgages up to about 55% (varies by age, home and area); rates are indicative. Ask a professional about taxes, OAS and estate effects.