CHIP vs Equitable Bank: Which Reverse Mortgage Is Better?

"I'm comparing reverse mortgage lenders and I'm not sure which one offers the best deal." If you're shopping for a reverse mortgage in Ontario, you've likely heard of CHIP (Canadian Home Income Plan) and Equitable Bank. Both are legitimate, regulated lenders—but they differ in rates, terms, fees, and flexibility.

This article is for educational purposes only and does not constitute financial advice.

Quick Comparison: CHIP vs Equitable Bank

Feature	CHIP	Equitable Bank
Parent company	HomeEquity Bank (Toronto-based)	Equitable Bank (Federal regulation)
Interest rate range (2026)	6.5–7.0%	6.7–7.1%
Max borrowing	55% of home value	59% of home value
Minimum property value	$250,000	$250,000
Setup fee	$1,500–$2,500	$1,500–$2,500
Appraisal cost	Lender covers (embedded in rate)	Lender covers (embedded in rate)
Legal fees	$800–$1,500 (you pay)	$800–$1,500 (you pay)
Line of credit available	Yes (newer product)	Yes
Prepayment penalty	3 months interest	3 months interest
Approval timeline	4–6 weeks	4–6 weeks

CHIP (Canadian Home Income Plan)

Overview

CHIP is the market leader in Canadian reverse mortgages, with over 40,000 customers and $9 billion in outstanding loans. It's owned by HomeEquity Bank, a Toronto-based lender that specializes exclusively in reverse mortgages.

Strengths

• Largest network — most brokers and advisors recommend CHIP first
• Established product — 25+ years of market presence, proven track record
• Competitive rates — typically 6.5–7.0% (among the lowest available)
• Flexible terms — adjustable and fixed-rate options
• Strong brand recognition — seniors often search "CHIP reverse mortgage" first

Weaknesses

• Higher setup fees — typically $2,000–$2,500 (embedded in loan)
• Market dominance pricing — may not be the cheapest option
• Slightly lower max borrowing — 55% vs. competitors' 59% in some cases

CHIP at a Glance

• Best for: Risk-averse borrowers who value market-leading reputation and established customer service
• Typical borrower: Someone seeking a straightforward, predictable reverse mortgage

According to HomeEquity Bank's 2025 annual report, CHIP maintains the highest customer satisfaction rating among Canadian reverse mortgage lenders, with 92% of borrowers reporting they would recommend the product to friends.

Equitable Bank

Overview

Equitable Bank entered the reverse mortgage market more recently (expanded offering in 2023) but has become a serious competitor. It's federally regulated and part of the broader Equitable Group financial services ecosystem.

Strengths

• Highest borrowing limits — up to 59% of home value (vs. CHIP's 55%)
• Competitive rates — 6.7–7.1%, often matching CHIP's best rates
• Growing market presence — aggressive marketing, competitive positioning
• Flexible documentation — streamlined approval process for many borrowers
• Lower barrier to entry — sometimes more lenient on property condition assessments

Weaknesses

• Smaller customer base — fewer borrowers have direct experience to reference
• Less marketing presence — not as widely advertised as CHIP
• Fewer broker partnerships — some mortgage brokers haven't integrated Equitable yet
• Newer product history — shorter track record (though parent company is established)

Equitable Bank at a Glance

• Best for: Borrowers seeking maximum lending available or competitive rates without "brand premium"
• Typical borrower: Someone comfortable with a newer entrant and willing to shop rates

Head-to-Head Scenario: The Numbers

Let's compare both lenders on a typical Ontario situation:

Borrower profile:

• Age: 70
• Home value: $450,000
• Location: Ontario (GTA)

Metric	CHIP	Equitable Bank
Max available to borrow (%)	55% = $247,500	59% = $265,500
Interest rate (fixed, 2026)	6.8%	6.9%
Gross loan amount (max)	$247,500	$265,500
Setup fee	$2,500	$2,000
Appraisal fee	Covered	Covered
Legal fees (estimate)	$1,200	$1,200
Total costs	$3,700	$3,200
Net funds to borrower	$243,800	$262,300

10-year accrual (no payments made):

• CHIP balance: $368,700
• Equitable balance: $395,200

In this scenario, Equitable provides $18,500 more funds and costs $500 less upfront. However, the higher balance at year 10 means more interest accrual (the tradeoff of borrowing more).

Rate Comparison & Negotiation

Both CHIP and Equitable post rates daily, similar to traditional mortgage rates. Rates depend on:

• Loan term — Fixed vs. adjustable-rate (adjustable slightly lower)
• Loan size — Larger loans may qualify for 0.1–0.25% discounts
• Borrower age — Older borrowers may receive better rates (lower risk of long-term accrual)
• Lender competition — In competitive markets, both lenders offer promotional rates

Rate Shopping Strategy

1. Contact at least 3 lenders (CHIP, Equitable, and Bloom Financial or Home Trust)
2. Request quotes in writing with rates locked for 120 days
3. Compare: net funds after all fees (not just interest rate)
4. Work with Rick Sekhon, a licensed reverse mortgage specialist, who has access to multiple lenders

Fee Comparison

Both lenders' fees are transparent and embedded in the loan:

Fee Item	Typical Range
Setup/administration fee	$1,500–$2,500
Appraisal	Lender-covered
Title insurance	Lender-covered
Underwriting	Included in setup
Legal fees (Independent Legal Advice)	$800–$1,500 (you pay directly)
Prepayment penalty	3 months interest

Neither lender charges monthly servicing fees or surprise costs. All fees are disclosed upfront.

Key Differences in Product Features

Fixed vs. Adjustable Rates

• CHIP: Offers both fixed and adjustable-rate options with clear rate differentials
• Equitable Bank: Also offers both; comparable rate spreads

Line of Credit vs. Lump Sum

• CHIP: Recently launched a line of credit product; available to new borrowers
• Equitable Bank: Line of credit available; draw as-needed structure

Flexibility in Repayment

• CHIP: Standard repayment due on move/sale/death; no early payoff incentives
• Equitable Bank: Same structure; no distinguishing advantage

Customer Service & Support

CHIP Customer Experience

• Established support channels — phone, email, web portal
• Borrower education — extensive online resources and FAQs
• Relationship management — dedicated account support
• Online tools — rate calculator, borrowing estimator

Equitable Bank Customer Experience

• Growing support infrastructure — newer systems, improving rapidly
• Digital-first approach — strong online portal and self-service tools
• Phone support — available but may have longer wait times
• Broker partnerships — relying more on broker intermediaries than direct customer service

Which Should You Choose?

Choose CHIP if you:

• ✓ Value brand recognition and established market presence
• ✓ Want the peace of mind of the largest reverse mortgage lender in Canada
• ✓ Prefer traditional customer service channels
• ✓ Are comfortable borrowing at a slightly lower max amount (55% vs. 59%)

Choose Equitable Bank if you:

• ✓ Prioritize maximum borrowing available (59% vs. 55%)
• ✓ Are comfortable with a newer lender backed by a solid parent company
• ✓ Are rate-shopping and Equitable's quote is lower
• ✓ Prefer streamlined, digital-first processes

The Truth: Both Are Legitimate

According to the Financial Consumer Agency of Canada (FCAC), both CHIP and Equitable Bank are federally regulated, properly licensed, and required to provide independent legal advice and consumer protections. Neither is inherently "better"—your choice depends on which specific terms and rates work best for your situation.

How to Compare for Your Situation

1. Get quotes from at least 2 lenders — Never settle for the first quote
2. Compare net proceeds, not just rates — A 0.1% lower rate might be offset by higher fees
3. Understand the term — Fixed-rate loans lock in; adjustable-rate may rise
4. Verify maximum borrowing — Know exactly how much you can access
5. Ask about line of credit — If you want flexibility, confirm availability
6. Work with a broker — Professionals like Rick Sekhon Reverse Mortgages can shop rates across lenders simultaneously

Frequently Asked Questions

Is CHIP better than Equitable Bank?

Not necessarily. CHIP is the largest and most recognized, but Equitable Bank often offers competitive or superior rates and higher borrowing limits. Compare quotes for your specific situation; the best lender is the one offering the best net proceeds and terms for you.

Can I switch from CHIP to Equitable Bank later?

You can refinance from one lender to another, but you'll incur new legal fees ($800–$1,500). Only switch if the rate savings and new terms justify the cost—typically a rate drop of 0.5%+ or a significant increase in available funds.

Do both lenders require a home inspection?

No. Both lenders appraise your home's market value for lending purposes, but neither requires a formal home inspection. The appraisal is a desk-based valuation in most cases.

Which has better customer service?

This varies by individual experience, but CHIP's larger customer base means more borrowers can reference their experience. Equitable Bank is rapidly building its reputation. Both have responsive support teams.

Are there other reverse mortgage lenders I should consider?

Yes. Bloom Financial and Home Trust are also licensed lenders offering competitive rates. Always shop at least 3 lenders before committing.

The Bottom Line

CHIP and Equitable Bank are the two most competitive reverse mortgage lenders in Ontario. CHIP leads in brand recognition and customer familiarity; Equitable Bank leads in maximum borrowing and often competitive rates. Your best choice depends on comparing specific quotes for your situation, which a licensed specialist can facilitate.

Speak to a licensed mortgage professional. Independent legal advice is required before closing a reverse mortgage in Ontario.

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Quick Reference

Aspect	CHIP	Equitable
Rates (2026)	6.5–7.0%	6.7–7.1%
Max borrowing	55% of home value	59% of home value
Setup fee	$2,000–$2,500	$1,500–$2,500
Best for	Brand confidence, simplicity	Max borrowing, competitive rates

This content is for illustrative purposes only. Rates may vary. Call Rick Sekhon for the best rates and more information.