CHIP Reverse Mortgage Review 2025

No fee everyday banking

Set up direct deposit and skip the monthly fee. Free to open, and the Easy plan has no monthly fee. Worth doing if you will actually move your pay or your CRA deposits over, not if the card sits unused. Code BREMO2026.

See how it works

Bremo verdict: CHIP is Canada's most established reverse mortgage product and the safest option for eligible seniors needing income from home equity. However, the rates are considerably higher than HELOCs or standard mortgages. Best for retirees who cannot qualify for a HELOC and want to stay in their home.

CHIP at a Glance
Provider: HomeEquity Bank
Min. Age: 55
Max. Loan: Up to 55% of home value
Monthly Payments: None required
Rate Type: Fixed or variable
No Negative Equity: Yes (guaranteed)

What Is the CHIP Reverse Mortgage?

CHIP (Canadian Home Income Plan) is offered by HomeEquity Bank, Canada's only federally regulated lender specializing exclusively in reverse mortgages. HomeEquity Bank has been operating since 1986 and holds the vast majority of Canada's reverse mortgage market share.

CHIP allows homeowners aged 55+ to borrow against their home equity without making any monthly payments. The loan balance accumulates interest and is repaid when the home is sold or the borrower moves out permanently.

CHIP Rates in 2025

Rate Type	Approximate Rate
6-month fixed	6.49%–7.49%
1-year fixed	6.69%–7.69%
3-year fixed	7.29%–8.29%
5-year fixed	7.49%–8.49%
Variable rate	Prime + 2.0%–3.0%

Rates vary by age, location, and LTV. Contact HomeEquity Bank directly for a personalized quote.

CHIP Fees and Costs

Fee	Amount
Appraisal fee	$300–$500
Independent legal advice (required)	$300–$600
Closing/administration fee	~$1,795
Title insurance	~$200–$400
Prepayment penalty (if broken early)	3 months interest or IRD

Eligibility Requirements

All homeowners on title must be 55 or older
Property must be your primary residence
Eligible property types: detached, semi-detached, townhouse, condo (with conditions)
Minimum home value: approximately $150,000
Must be in a qualifying area (primarily urban and suburban Canada)
No income or credit score requirements — qualification is primarily equity-based

CHIP Pros and Cons

Pros

No monthly payments required — ideal for fixed-income retirees
Tax-free funds — not considered income by CRA
No negative equity guarantee — you can never owe more than the home is worth
You retain title and ownership throughout
Flexible disbursement — lump sum, scheduled advances, or a combination
Does not affect CPP, OAS, or GIS benefits
Simple qualification — no income test or minimum credit score

Cons

High interest rates compared to HELOCs and standard mortgages
Compounding interest significantly erodes equity over time
Reduces inheritance for heirs
Higher closing costs than standard mortgages
Prepayment penalties can be substantial if you want to exit early
Limited to primary residences — investment properties don't qualify

How CHIP Compares to a HELOC

Feature	CHIP Reverse Mortgage	HELOC
Monthly payments	None	Minimum interest
Rate	6.5%–9%	~5.45%
Age requirement	55+	None
Income required	No	Yes
Credit score	Not required	650+ required
Max borrowing	Up to 55% of value	Up to 65% of value

Who Should Consider CHIP?

Retirees on fixed income who can't afford HELOC payments
Seniors who don't qualify for a HELOC due to insufficient income
Homeowners who want to stay in their home for 5+ more years
Those who want to supplement CPP/OAS without selling their home

Free Up Cash Flow While You Manage Your Home Equity

Stop paying monthly bank fees while you figure out your HELOC strategy. KOHO gives Canadian homeowners a no-fee account with cash back on spending. Use code BREMO2026 for a sign-up bonus.

Get KOHO Free — Use Code BREMO2026

Frequently Asked Questions

Is CHIP the only reverse mortgage in Canada?

CHIP is the largest and most established, but Equitable Bank (PATH Home Plan) and Bloom Finance also offer reverse mortgages in Canada. Competition has increased in recent years, putting slight downward pressure on rates.

Can my children inherit the home with a CHIP reverse mortgage?

Yes — your estate has up to a certain period (typically 6 months) after you pass away to repay the CHIP loan, often from sale proceeds. Heirs can also choose to pay off the loan and keep the home.

What is the independent legal advice requirement?

CHIP requires all borrowers to obtain independent legal advice (ILA) from a lawyer who is not connected to HomeEquity Bank. This protects seniors from being pressured into the product and is mandatory for all CHIP closings.