Reverse Mortgage - Long-Term Care

Reverse Mortgage and Long-Term Care Costs in Ontario

One of the most common reasons Ontario homeowners consider a reverse mortgage is to fund aging-in-place home modifications or in-home care as an alternative to moving to a long-term care facility. A reverse mortgage can provide tax-free equity access for in-home care costs - subject to the primary residence requirement.

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FSRA Brokerage #13449Â·Hardeep Batoo, Broker Licence #M13002408Â·Ontario-wideÂ·General information only

The basics

Long-term care costs in Ontario - what they look like

Long-term care in Ontario is regulated under the Fixing Long-Term Care Act, 2021. Government-licensed long-term care facilities offer accommodation in basic, semi-private, and private accommodation, with daily rates regulated by the province. As of 2024, regulated basic accommodation was approximately $1,891.31/month; semi-private was approximately $2,280.03/month; private was approximately $2,701.61/month. Confirm current rates directly with the Ministry of Long-Term Care as they are updated periodically.

Specialized private memory care or retirement homes are not subject to the same rate regulation and can be significantly higher - sometimes $4,000â€“$8,000/month or more depending on the level of care and facility.

For many Ontario seniors, the cost of quality care is a significant financial strain. A reverse mortgage can provide access to home equity to fund care costs - but the primary residence requirement means there is a critical limitation.

Who it's for

What a reverse mortgage can and cannot fund for care

The primary residence requirement is the key constraint.

In-home PSWs (personal support workers) - reverse mortgage can fund this

Home modifications (ramps, grab bars, stair lifts) - reverse mortgage can fund this

Housekeeping and meal services to remain at home - reverse mortgage can fund this

Medical equipment or mobility aids - reverse mortgage can fund this

Overnight or 24-hour in-home care - reverse mortgage can fund this while staying home

Permanent long-term care facility costs - reverse mortgage becomes due when you move permanently

Temporary hospitalization or rehabilitation - lender may allow temporary absence; confirm terms

Funding care for a spouse who moves to facility while you remain home - may be possible if you stay

The reverse mortgage requires the borrower to continue occupying the property as their primary residence. If the borrower permanently moves to a long-term care facility, the reverse mortgage typically becomes due.

Rates & costs

Long-term care cost context vs reverse mortgage equity access

Understanding both sides of this financial decision before committing.

LTC rates are as of 2024. Confirm current rates directly with the Ontario Ministry of Long-Term Care. These are general figures only. Reverse mortgage eligibility, qualifying amount, and terms subject to lender criteria and individual assessment. O.A.C. E.&O.E.

What it costs

Regulated basic LTC accommodation (2024)Approximately $1,891/month - confirm current rate with Ministry
Regulated semi-private LTC accommodation (2024)Approximately $2,280/month
Regulated private LTC accommodation (2024)Approximately $2,701/month
Private retirement home or memory careOften $4,000â€“$8,000+/month - not provincially regulated
In-home PSW care (vs facility)Variable - but can be funded by reverse mortgage while maintaining primary residence

How it works

How to use a reverse mortgage for aging-in-place care costs

Confirm primary residence requirement

The reverse mortgage is available as long as the borrower occupies the property as their primary residence. Confirm what 'permanent move' means in your specific lender's commitment documents.

Assess qualifying amount

Based on age and property value, determine how much equity is available. This tells you how long reverse mortgage proceeds can fund in-home care before the equity is depleted.

Compare in-home care cost vs facility cost

In-home care funded by a reverse mortgage may cost less than a facility, particularly in the early stages. A financial advisor can help model this comparison over a multi-year horizon.

Plan for what happens if you do move

If circumstances change and a permanent move to care is eventually needed, understand that the reverse mortgage becomes due. The proceeds from the home sale would then fund ongoing care costs.

Review with family and advisors

This decision affects the family and the estate. Involve family members, a financial advisor, and an Ontario lawyer in the conversation before committing.

Critical condition

A reverse mortgage funds in-home care - not permanent facility care

A reverse mortgage requires the borrower to remain in the home as their primary residence. It is useful for funding care that allows you to stay home. If you permanently move to a long-term care facility, the reverse mortgage becomes due and the home must be sold. The proceeds then become available for ongoing facility costs. Plan for both scenarios.

See: when you die - estate options →

Why a broker

We model both scenarios - aging in place and eventual facility move

The decision to use a reverse mortgage for care costs should be modeled for both the optimistic scenario (remaining at home for many years) and the realistic scenario (eventually requiring facility care). We model both before you commit.

We also confirm which lender has the most suitable terms for a borrower who may have health considerations affecting long-term occupancy. Some lenders have different terms for temporary absences than others.

Plan for both scenarios - staying home and eventually moving to care. The right structure depends on which scenario is more likely for your situation.

Reverse mortgage Ontario →

FAQ

Frequently Asked Questions - Reverse Mortgage and Long-Term Care

Can I use a reverse mortgage to pay for in-home care in Ontario?+

Yes. A reverse mortgage can provide tax-free access to home equity to fund in-home PSWs, home modifications, and care services - as long as you continue to occupy the property as your primary residence.

What happens to the reverse mortgage if I move to a long-term care facility?+

When the last borrower permanently moves out of the home - including moving to a long-term care facility - the reverse mortgage typically becomes due. The home would need to be sold to repay the balance. Some lenders have provisions for temporary absences. Review the exact terms with your lawyer before signing.

Is a reverse mortgage the right way to fund long-term care costs?+

It depends on your situation. A reverse mortgage is appropriate for funding in-home care while you remain in the home. For permanent facility care, the home sale proceeds become available after the mortgage is repaid. A financial advisor can help model the long-term cost comparison for your specific situation.

Speak with a reverse mortgage specialist about care cost planning

Call 647-542-6100 or apply online. We review your situation and model the options for funding in-home care or planning for eventual facility costs.

Apply Call (647) 542-6100

General information only. Does not constitute legal, financial, or health care advice. Independent legal advice required before any reverse mortgage closes. O.A.C. E.&O.E.

FSRA Brokerage #13449 Â· Hardeep Batoo, Broker Licence #M13002408 Â· Ontario-wide

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