Reverse mortgage blog
Reverse Mortgage Complaints in Canada: What's Reported (2026)
General information for Canadian homeowners, not personal financial, legal, or tax advice.
Key takeaways
- Across every federally regulated bank and trust company in Canada, mortgages of all kinds drew 14,690 complaints in 2024–25 — the fourth most-complained-about product, out of 268,718 complaint reports (Financial Consumer Agency of Canada).
- No Canadian regulator counts reverse mortgage complaints separately. Both FCAC and the banking ombudsman stop at "mortgages" as a category (OBSI 2025 Annual Report). An absence of a published category is not proof that there are no problems.
- A bank has 56 calendar days to deal with a complaint and cannot pause that count. A July 2025 review found some banks missing the deadline and "freezing the clock" (FCAC thematic review).
- Since November 1, 2024, one body handles unresolved bank complaints: the Ombudsman for Banking Services and Investments. It is free, and it can recommend compensation up to $350,000 — but its recommendations are not binding (OBSI).
- Three of the four lenders are federally regulated; Bloom is licensed province by province, so its complaints route to the provincial regulator instead. The protections that matter most — the No Negative Equity Guarantee and required independent legal advice — come with all four.
- Every Ontario mortgage brokerage must designate someone to handle complaints and answer in writing, setting out its proposed resolution and your right to take it further (FSRA, O. Reg. 188/08).
Reverse mortgage complaints in Canada are mostly about expectations rather than wrongdoing — a balance that grew faster than expected, the cost of leaving early, and what the family faces afterwards. A complaint is dissatisfaction. A scam is a crime.
Most Canadians looking into a reverse mortgage want to know what other borrowers ended up unhappy about.
The challenge is that two very different things share one word. A complaint means someone is dissatisfied with a real mortgage from a real lender. A scam is a crime, and Canada’s headline cases were crimes.
The complaints themselves follow a short list of patterns: a balance that grew faster than expected, the cost of getting out early, how long an estate has to settle after a death, and terms that were never properly explained before anything was signed.
This page sets out those patterns one by one, what Canada’s regulators actually publish about them, and who to complain to when something has already gone wrong.
What do people actually complain about with reverse mortgages?
Almost every complaint traces back to the same gap: what the borrower expected, set against what the mortgage actually does. Very few are about a lender breaking a rule.
A complaint isn’t a crime
Both get searched with the same words, so they’re worth separating first.
A complaint means someone is unhappy with a real mortgage from a real lender. The lender handles it, and a regulator or an ombudsman takes over if the lender can’t.
A scam is a crime, committed by someone outside that process against a homeowner who usually never applied for anything. Canada’s headline cases — an alleged title fraud in Brampton and an equity-stripping scheme in Waterloo — were crimes of that kind, covered in reverse mortgage scams in Canada and told in full in reverse mortgage horror stories.
What are the most common complaints about reverse mortgages?
Six patterns come up again and again. Each has a mechanism that prevents it, and in five of the six that mechanism is a conversation that should have happened before signing.
The balance grew faster than expected
The most common one, and it’s the product working as designed.
There are no required monthly mortgage payments, so interest is added to the balance instead of being paid each month. It compounds semi-annually, the same as any Canadian mortgage. What catches people out is the timing: compounding is slow at the start and picks up later, so year twelve looks very different from year three.
Equity doesn’t automatically disappear, though. Home values usually rise over the same period, and Canadian borrowers keep about half of their equity on average. Taking less than the maximum for your age, and drawing it only as the money is needed, keeps that gap wide.
Leaving early cost more than expected
A reverse mortgage is built to be held for years, not exited quickly. Repaying it in the first several years usually triggers an early-payment charge, which starts highest, steps down over time, flattens out at around three months’ interest, and eventually falls away.
Two things soften it. The charge is waived outright on death, and eased on a move into long-term care — cut by half on some products, waived on others. Some lenders also allow up to 10% of the balance to be repaid each year without a charge.
The complaint comes when someone sells sooner than they planned. Saying up front that a move is realistic within a few years prevents it, because another product or lender usually suits that timeline better (paying off early covers how the charge behaves).
The family had less time than they thought
Once the last borrower dies or moves out permanently, the mortgage becomes due. The estate then has roughly 180 to 365 days to sell or refinance, depending on the product, and interest keeps accruing meanwhile.
Families who learn about the mortgage after the funeral are the ones who complain. Families who knew in advance rarely do.
In Ontario, probate doesn’t stop the family listing the home — only from closing the sale. Telling the executor early, and which lender holds the mortgage, turns this from a shock into a task (what heirs have to do sets out the steps).
Nobody explained it properly before signing
This is the one that’s a genuine service failure rather than the product behaving normally.
Every Canadian reverse mortgage requires independent legal advice — a private meeting with the borrower’s own lawyer before anything becomes final. That meeting exists to catch exactly this. Complaints still happen when someone felt rushed through it, or when the person arranging the mortgage skated over the early-payment charge, the renewal, or what the family would face.
The protection is already built in: that appointment can’t be skipped, and the lawyer is working for the borrower rather than the lender (independent legal advice explains the meeting).
One spouse was left off the mortgage
Most files put both spouses on the mortgage and on title, which is right for the great majority of borrowers.
One lender allows a couple to qualify on the older spouse’s age alone, which unlocks meaningfully more money. The trade has to be understood before it’s taken: a spouse who isn’t on the mortgage has no automatic right to stay in the home if the borrowing spouse dies first, and the mortgage becomes due at that point.
That trade is defensible with four things in place: the younger spouse gets their own independent legal advice, signs knowing the mortgage will come due, has a plan for that day, and the will passes the home to them properly. The complaints come from files where those four were skipped (who qualifies and what goes on title covers the rules either way).
The renewal rate came as a surprise
A reverse mortgage runs for life, and the term inside it is a rate reset rather than a maturity date. There’s no penalty-free exit window when a term ends.
One letter arrives, usually one to two months before the reset, stating the new term options and the rate on each. A letter nobody answers renews the mortgage into a new term automatically.
Renewal rates matter more to the total cost of borrowing than the starting rate does. That’s why the relationship shouldn’t end at closing — a broker who reconnects at least six months before each reset can price both paths: renew as-is, or move if another lender’s rate clears the costs (how renewals work).
What do Canada’s regulators actually publish about reverse mortgage complaints?
Nothing reverse-mortgage-specific, and that’s worth stating plainly rather than dressing up.
Canada’s federally regulated banks and trust companies report every complaint they receive to the Financial Consumer Agency of Canada. In 2024–25 that came to 268,718 reports. Mortgages of every kind — purchases, renewals, refinances, reverse mortgages, all together — were the fourth most-complained-about product, at 14,690 complaints, or 6.1% of the total.
“Mortgages” is as specific as the published numbers get, at the agency and at the ombudsman alike. So nobody counts reverse mortgage complaints separately in Canada, and that cuts both ways. An absence of a published category isn’t proof that there are no problems, and it doesn’t support anyone claiming complaints here are rare either.
Canada differs from the United States on this. The American consumer protection bureau runs a public complaint database that does have a reverse mortgage category, so American counts are easy to find — and they describe American products, American rules, and an American market.
Who regulates which lender
Three of Canada’s four reverse mortgage lenders are federally regulated. HomeEquity Bank and Equitable Bank are banks, and Home Trust Company is a federally regulated trust company. Bloom Finance isn’t federally regulated — it’s a lender licensed province by province, currently in Ontario, Alberta and British Columbia.
That changes where a complaint goes, and nothing else. The label isn’t what protects a borrower. The No Negative Equity Guarantee and the required meeting with your own lawyer come with all four, and deposit insurance has no bearing either way, because a borrower isn’t putting money in with these lenders — they’re borrowing it.
Who do you complain to about a reverse mortgage in Canada?
The lender or the broker comes first, every time. Both are required to have a complaints process, and the outside bodies will send you back if you haven’t used it.
The bank’s clock starts the day after you complain
Since June 30, 2022, a bank has 56 calendar days to deal with a complaint, and it can’t pause that count for any reason. If the matter isn’t settled within 14 days it goes to a designated complaints employee, and when it closes you get a substantive written response.
One detail decides whether any of this reaches you. “Complaint” is defined broadly — any expression of dissatisfaction, whether justified or not. You don’t have to use the word, or put it in writing, for the bank to be required to record it.
Every FSRA-licensed Ontario brokerage must also designate someone to handle complaints and answer in writing, setting out its proposed resolution and your right to take the matter to FSRA. This brokerage has one like every other, published at complaints. There’s no legislated deadline on that side — the requirement is a reasonable timeframe.
What an internal complaints process won’t do
An internal process handles how you were treated, and whether the lender did what it said it would do. It’s not a route to renegotiate the interest rate, the fees, or the lending decision itself. Those are commercial terms, and a senior complaints officer will generally decline to rule on them.
That matters for timing more than anything. The rate, the set-up fee and the early-payment charge are all settled before signing, which is the only point at which they can still be compared across lenders and negotiated.
| Who the complaint is about | Where it starts | Where it goes if unresolved |
|---|---|---|
| A federally regulated lender — HomeEquity Bank, Equitable Bank, or Home Trust | The lender’s own complaint process. For the two banks, the law allows 56 days. | OBSI — free, independent, can recommend up to $350,000 |
| Bloom Finance, licensed province by province | Bloom’s own complaint process | FSRA in Ontario (BCFSA in British Columbia) |
| The brokerage or agent who arranged the mortgage | The brokerage’s designated complaints person, who must reply in writing | FSRA in Ontario |
Since November 1, 2024, a single body has handled unresolved bank complaints: the Ombudsman for Banking Services and Investments. It’s free, independent of the banks, and can recommend compensation up to $350,000. Two limits matter. You have 180 days from the lender’s written final response to bring it to OBSI, and its recommendations aren’t binding.
FSRA can act on an Ontario licence through warnings, conditions, penalties, suspension or revocation. It can’t award you money, though — its powers are over the licence, not the contract.
The Financial Consumer Agency of Canada supervises the whole system, and what it won’t do matters, because people write to it expecting a resolution. In its own words, the agency “does not resolve individual complaints or provide compensation to consumers.”
It does police the deadline. Its July 2025 review of six small and medium-sized banks found several missing the 56 days, and some “freezing the clock” while they waited on the customer. Knowing the count runs continuously, and starts the day after you complain, is what stops that happening quietly to you.
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Get my free estimateHow do you avoid having a complaint in the first place?
Almost every pattern above traces back to one moment: something that was never explained before anything was signed.
The first question is whether a reverse mortgage fits at all, not which lender to use. Savings, a regular mortgage, a line of credit, or selling and moving each win in some situations, and an independent broker arranges most of those too.
The six things to settle before anything is signed
- Whether this is the right tool at all, measured against the alternatives with real numbers.
- What the balance looks like in ten and twenty years, not just what arrives on day one.
- What leaving early would cost, if a sale or a move is realistic.
- What happens at the first rate reset, and who reconnects with you before it.
- What the family will face, and whether the executor already knows.
- Who goes on the mortgage and on title, and what it means if a spouse doesn’t.
Independent legal advice is required before anything becomes final, and that lawyer works for the borrower. Choosing a reverse mortgage broker covers the questions that show whether the person arranging it knows this product — most brokers work mainly on traditional mortgages, and a reverse mortgage runs on different rules.
Comparing all four lenders settles most of that list, and it costs the homeowner nothing, because the lender pays the broker. A free estimate is where that comparison starts, and it puts nothing on your title. For how the product works first, start with what a reverse mortgage is, or the CHIP reverse mortgage review if that’s the one being offered to you.
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Frequently asked questions
What are the most common complaints about reverse mortgages?
Most fall into six patterns: a balance that grew faster than expected, the cost of repaying early, how little time an estate has to settle, terms that were never explained before signing, one spouse being left off the mortgage, and a renewal rate that arrived as a surprise. Only one of those — the explaining — is a service failure rather than the product working as designed. Canadian regulators do not publish complaint counts specific to reverse mortgages, so these are the patterns seen in practice rather than a ranked list from published data.
Who do you complain to about a reverse mortgage lender in Canada?
Start with the lender's own complaint process, which every lender is required to have. If the lender is HomeEquity Bank, Equitable Bank, or Home Trust, it is federally regulated, and an unresolved complaint can go to the Ombudsman for Banking Services and Investments (OBSI) — free, and up to 180 days after the lender's written final response. Bloom Finance is licensed province by province rather than federally regulated, so an Ontario complaint about Bloom goes to the Financial Services Regulatory Authority of Ontario (FSRA). Complaints about the brokerage or agent who arranged the mortgage also go to FSRA in Ontario.
Are there complaints about the CHIP reverse mortgage?
No Canadian regulator publishes complaint counts for any individual reverse mortgage product, CHIP included — the published categories stop at 'mortgages'. The patterns people raise about CHIP are the same ones raised across the market: compound interest, the cost of leaving early, the estate timeline, and terms not explained clearly at the start. HomeEquity Bank is federally regulated, so an unresolved complaint about a CHIP reverse mortgage can be escalated to OBSI after 56 days or after a written final response.
Is a reverse mortgage complaint the same as a scam?
No. A complaint means someone is dissatisfied with a real mortgage from a real lender, and it is handled by the lender, a regulator, or an ombudsman. A scam is a crime committed by someone outside that process, usually against a homeowner who never applied for anything. Canada's headline cases — an alleged title fraud in Brampton and an equity-stripping scheme in Waterloo — were crimes of that second kind, not reverse mortgages going wrong.
Can you cancel a reverse mortgage after signing?
It can be repaid in full at any time, but repaying in the first several years usually triggers an early-payment charge. That charge starts highest, steps down over the years, flattens out at around three months' interest, and eventually falls away. It is waived outright on death and eased on a move into long-term care. If a sale or move is realistic within a few years, saying so before anything is arranged is what prevents the charge becoming a complaint, because a different product or lender usually suits that timeline better.
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Get my free estimate About the author
Richard Hopkins
Licensed Mortgage Broker · M16000896
Richard has worked in the mortgage business since 2013 — first as a mortgage agent, today a licensed mortgage broker — and leads the reverse mortgage practice at Homestead Financial — Dominion Lending Centres, an FSRA-licensed Ontario brokerage (#11711) with roots in the industry since 1999 and more than 2,500 mortgages funded. More about Richard →
This article is general information for Canadian homeowners, not personal financial, legal, or tax advice. Everyone's situation is different — please get advice on your own numbers before making a decision.