Your client needs $100,000. Here's what each source actually costs.
This page is for financial planners, estate lawyers and accountants whose clients are 55 or older, asset-rich and short on accessible cash. It is a comparison, not a pitch — including the cases where a reverse mortgage is the wrong answer.
Four ways to raise $100,000 for a retired client
| Source | What they get | What it costs |
|---|---|---|
| LIRA or RRIF withdrawal | $100,000 before tax | Fully taxable as income. At a high marginal rate the tax can approach $70,000 on a withdrawal of this size, leaving far less than the client expected. Registered room is also lost permanently. |
| Non-registered assets | $100,000 | Capital gains on the disposition, plus the loss of whatever that position was earning. Sequence-of-returns risk if the market is down when they need the cash. |
| Selling the home | Full equity, less costs | Real estate commission, legal fees, land transfer tax on the next purchase, moving costs — and the client leaves a home they may not want to leave. |
| Reverse mortgage | $100,000 | Tax-free, because it is a loan and not income. No monthly payment required. Interest accrues against the equity, so the estate's share of the home shrinks over time. |
Illustrative only. The tax on a registered withdrawal depends on the client's province, total income in the year and the size of the withdrawal. Confirm the actual figure with the client's accountant before relying on it.
When we tell clients no
A reverse mortgage is the wrong product more often than the marketing suggests. These are the situations where we decline or recommend something else:
The horizon is short.
If the client is likely to sell or move within two or three years, the set-up costs and accrued interest rarely justify it. A short-term second mortgage or a line of credit usually costs less.
One spouse is under 55.
The calculation runs on the age of the youngest owner on title. A significant age gap between spouses reduces the available amount sharply, sometimes to the point where the product stops making sense.
The property sits in a thin market.
Lenders price confidence in the appraisal. A rural or unusual property in a market where a sale takes months will support a lower percentage, and sometimes no offer at all.
The family expects to inherit the house intact.
Interest accrues against the equity. If the plan is for the children to keep the property, that conversation has to happen before the mortgage is arranged, not after.
How referrals work
Send the client to me directly, or forward this page. I will assess suitability and tell you plainly if a reverse mortgage is not the right answer — including when the better answer is one your client can arrange without a mortgage at all. You keep the relationship; I handle the financing.
Saminder Juneja, Mortgage Broker — Mortgage Centre Canada, independently owned and operated by Get A Better Mortgage Inc., FSRA #10874. Mortgage advice only. Nothing on this page is tax, legal, estate or investment advice. Tax treatment of a registered withdrawal depends on the client's circumstances and should be confirmed with their accountant.