Reverse mortgage or HELOC: the difference is what happens if nothing gets repaid.

A HELOC is available to any homeowner with sufficient equity, and qualification runs through income and credit like any other credit product — there's no age floor, but the borrower needs to demonstrate they can service the payments.

A reverse mortgage is generally available from age 55, with all owners on title required to meet that minimum. Income and credit history are not the primary qualifying factors; the lender is underwriting the property and the borrower's age far more than their cash flow.

That distinction is exactly why the two products tend to serve different moments in a client's life rather than competing head-to-head: a HELOC assumes ongoing income to service it, while a reverse mortgage is built for a stage where that income has often changed — retirement, a fixed pension, or a client who is simply asset-rich and cash-poor.

Both figures are ceilings, not guarantees — the exact amount a lender approves still depends on the property, its location, and the client's specific circumstances. A client who still owes a meaningful balance on a first mortgage will see that balance subtracted from either ceiling, which can leave less room than the headline percentage suggests, especially on a reverse mortgage where the deduction happens up front.

A HELOC typically requires at least an interest-only payment; the balance doesn't grow on its own unless the borrower draws more. A reverse mortgage requires no regular payments at all — interest accrues and compounds on the outstanding balance every month, which is repaid, along with the original principal, when the home is sold, the borrower moves out, or the last borrower passes away.

This is the part clients and their adult children often need walked through carefully: a HELOC that's serviced properly can sit at roughly the same balance for years, while an unserviced reverse mortgage balance grows every single month, even if the client never draws another dollar. Two clients who each borrow the same amount today can end up owing very different amounts a decade later, purely based on which product they chose and whether payments were made.

1. 01Can the client comfortably carry a monthly payment on the amount needed? If not, a reverse mortgage may be the only workable option.
2. 02Is the goal a one-time need or ongoing flexible access over time? A HELOC suits repeated draws better than a lump sum product.
3. 03How important is preserving equity for the estate or heirs? A compounding reverse mortgage balance erodes that equity faster than a serviced HELOC.
4. 04Is the client's income likely to change soon — a pending retirement or a return to work — that could shift which product fits a year from now, not just today?

Both products depend heavily on a clean appraisal — see appraisals in Canadian mortgage files for what actually moves that step along.

Reverse mortgages in particular involve extra steps — independent legal advice for the client, careful documentation of all owners on title, and a longer underwriting timeline than a standard HELOC. Treadstone's fulfillment support handles that documentation load so a broker can stay focused on which product actually serves the client.

It's also worth building in extra time for family conversations on these files — adult children are often involved in a reverse mortgage decision even when they're not on title, and a broker who anticipates that and schedules for it avoids a file stalling late in the process over questions that could have been answered up front.