Canadians nearing retirement are taking on more mortgage debt, with those aged 55 to 64 posting the fastest growth in 2025.
Statistics Canada data show mortgage balances for that group rose about 6% year-over-year, as many tap home equity to fund investment purchases or help younger family members enter the housing market.
Royal LePage data show that 29% of Canadians who are recently retired or nearing retirement will continue to make mortgage payments on their primary residence, nearly double the share from a decade ago and up from just 8% in 1999.
“It’s the bank of mom and dad effect,” explains Tracy Valko of Valko Financial. “Young people are trying to get into the housing market in Canada, which has been extremely challenging, so we’re seeing a huge uptick in mom and dad taking equity from their existing property to gift a down payment or provide financial support.”
According to the Canada Mortgage and Housing Corporation (CMHC)’s 2025 Mortgage Consumer Survey, 41% of first-time buyers relied on a gift or inheritance to cover mortgage costs, which averaged nearly $80,000. A further 20% of repeat buyers also received financial support from family, with contributions averaging $103,382.
Such gifts have become increasingly common among first-time buyers, particularly in higher-priced markets. “Debt isn’t disappearing in Canada,” says Valko. “It’s just moving up the age ladder.”
Financial pressures rising for older Canadians
With much of their wealth tied up in their primary residence, many older Canadians have taken steps—such as refinancing or extending amortization periods—to manage cash flow. Those decisions, however, are also pushing mortgage debt further into retirement.
“We’re extending the amortizations to try and increase their cash flow and trying to minimize that expense for them,” says Lisa Tomlinson, a mortgage broker for Invis “Sometimes we can’t amortize it to a point where they’re still qualifying, and we’re having to rely on different mortgage products, such as a reverse mortgage.”
Making matters more challenging are higher interest rates, which have added financial pressure on older Canadians. At the same time, many are facing rising living costs due to inflation and increasing healthcare needs, just as incomes are declining in retirement.
“Unfortunately, it has caused some of them to revert to selling their properties,” says Tomlinson. “Everything tends to get more expensive, to a point where it doesn’t make sense for them to continue [in their home].”
Retirement patterns are changing
As carrying mortgage debt into retirement becomes more common, Canadians are entering their later years with different financial constraints than in the past.
“People just need to understand that things have changed, it’s not the same world that they grew up in when their parents were aging, and we have new realities,” says credit expert Richard Moxley. “Things have changed with just how expensive things are in general, and if there’s an ability for them to continue working, I don’t necessarily see that as a bad thing.”
Statistics Canada data also show that 15.2% of Canadians over 65 remain in the workforce, following five years of consecutive increases. There are now 1.2 million seniors working in Canada, representing 5.2% of the country’s total labour force.
While many Canadians are choosing to remain on the job to help make ends meet, Moxley warns it’s not always a choice they get to make for themselves. “You can say ‘I’ll work another five years,’ but physically or mentally, can you? You just don’t know,” he says. “The challenge is that we are much less prepared for retirement than we have been historically.”
Mortgage options available for older borrowers
Canadians are facing greater financial challenges in their later years, but they also have more options at their disposal than previous generations, particularly when it comes to mortgage products.
“The two most popular options are reverse mortgages and Manulife One,” says Russ Morrison of Morrison Mortgage Team. “Both allow for cash flow and holding equity in the property over the long term.”
Morrison adds that neither solution is appropriate for every Canadian facing higher debt loads in retirement, but he says brokers should be able to find a solution that meets their financial needs at this stage of life.
“That’s why I work with clients to assess the situation and explain both products and make a recommendation and make sure they understand it,” he says. “We as mortgage brokers need to be more advisor-led than rate-focused in these situations.”
Both products allow homeowners to convert a portion of their home’s equity into tax-free cash without selling to help make ends meet. Demand for these product is continuing to rise, both as a function of the country’s demographics but also as borrowing costs and living expenses remain elevated.
“The strength of the Canadian mortgage ecosystem is that there are solutions designed to support people through virtually any financial challenge,” Morrison says. “That’s reassuring to people going into retirement with a mortgage, because they do have options.”
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CMHC demographics Lisa Tomlinson mortgage debt retirees retirement Richard Moxley Royal LePage Russ Morrison seniors statistics canada tracy valko
Last modified: April 27, 2026