If you own a home in Canada and are over 60, three well-established options let you access cash from your home without selling or moving. This side-by-side comparison covers HELOC, refinancing, and reverse mortgage to help you identify which one fits your situation.
Use the table below to compare the three options side by side. Each row covers a different feature. The right option depends on your age, income needs, home equity, and your heirs’ expectations.
| Feature | HELOC | Refinancing | Reverse mortgage |
|---|---|---|---|
| Monthly payment | Yes (interest only) | Yes (P+I) | No |
| Cash access | Revolving line of credit | Lump sum at closing | Lump sum, line, or monthly |
| Own the home | Yes | Yes | Yes (until sale) |
| Repayment | Any time | At sale or refinance | At sale (no maturity) |
| Equity for heirs | Reduced by loan balance | Reduced by new mortgage | Significantly reduced |
| Income requirement | Yes (some lenders accept pension) | Yes (some lenders accept pension) | No (no income required) |
| Typical processing time | 2 to 4 weeks | 4 to 6 weeks | 4 to 8 weeks |
How to read the table
HELOC is the most flexible. You draw what you need, when you need it, and pay interest only on what you use. The monthly payment is the interest on the outstanding balance, and the home is not sold. The trade-off is that the rate is typically variable, so the monthly payment can change. Refinancing replaces your mortgage with a new one at a higher amount, with the difference paid out in cash. The trade-off is that the new mortgage may carry a higher rate and a longer term, increasing the total cost. Reverse mortgage is repaid when the home is sold. The trade-off is that interest compounds over time, reducing equity remaining for heirs.
Which option fits your situation
HELOC fits if you want ongoing access to cash and can make monthly interest payments. Refinancing fits if you want a lump sum and can handle a higher monthly payment. Reverse mortgage fits if you want no monthly payments and are not concerned about reducing equity for heirs. For each option, expect total cost over the life of the loan to vary widely depending on your balance, term, and the prevailing rate at each reset.
How to get the best offer
Both home equity and debt relief are competitive markets. Get at least two quotes from licensed advisors before signing. Ask each the same questions: total cost over the life of the loan, monthly payment, and impact on the estate. The cheapest offer is not always the best offer. A lower rate with higher fees can be more expensive overall, while a higher rate with no fees can be cheaper. Compare the total cost over the expected life of the loan, not just the monthly payment. Most advisors offer a free initial consultation with no obligation, and the practical first step is a no-commitment comparison that takes about 60 seconds and does not affect your credit score. Once you have two or three offers in hand, verify that the advisor is licensed in your province and ask for a written estimate of the total cost over a 5-year and 10-year horizon so you can compare apples to apples.
Which option has the lowest total cost?
Which option has the lowest monthly payment?
Can I combine options?
Which option preserves equity for heirs?
Is this guide an official Government of Canada publication?
Independent guide. Not affiliated with any home equity lender. The information in this guide is editorial. The home equity options are offered by private lenders; confirm details on the official lender websites before acting on any information here.
