Fraction vs. Reverse Mortgages
Unlock your home equity with a Fraction Mortgage.
Avoid the prepayment penalties that come with reverse mortgages and get a fairer rate with Fraction.
A Fraction Mortgage is a flexible way to access your home equity.
Fraction can potentially help you reduce your debt to income ratio (the amount you spend monthly paying back debt) by up to 50% on average simply by eliminating monthly payments.
With a Fraction Mortgage, you can unlock a portion of your home's equity at a fair rate with no monthly payments.
Need to leave sooner? No problem. We don’t charge prepayment penalties.
Fraction's terms are clear and simple, and we will walk you through the whole process to make sure you understand everything before you sign. Check out our latest rates here.
The best part? No monthly payments, ever.
We’re making a lot of people happy
Taking out a Fraction mortgage changed our lives. It has helped us immensely. The staff and the process was amazing. Really appreciated everything about it.
Fraction have been a pleasure to deal with! Everything explained and ended up exactly as such! Very pleased to deal with them and its been one of the best moves of my life, considering my situation. Excellent service and I'm very pleased.
We are very pleased with Fraction. They were easy to deal with and very knowledgeable in answering our questions. We were always able to talk to a "real" person, not an answering machine. There has been no hassle from the company since we started. They let us know they are available if we need them.
Very professional and easy to deal with. Walked you through the whole process with ease. Any questions asked answered with patience
Professional, very efficient group of individuals assisted us in every way throughout the process. And we just paid it back so all wonderful on our part. But to be honest it was necessary and we pondered it for awhile although a good decision though and we still had funds available and spent it very wisely.
Relatively simple process, with good people to explain and help along the way. The closing and handling by lawyers, and funding dates, could use some fine-tuning, but all in all, a clear and simple process. Thanks Fraction.
They helped me get through the process very easily and explained every step of the way
The team at Fraction were very helpful, answered all my questions and explained fully the differences between a fractional mortgage and a reverse mortgage. For my situation it was a very easy decision and would highly recommend any senior who is house rich but cash poor to look into what they have to offer. A great way to access your homes equity without moving!
Found Fraction to be honest, upfront, fast, and available to answer questions. We would highly recommend them.
They helped us stay in our home. Explained everything in detail.
Friendly staff to deal with, lots of work to get started and quickly received the money. Once you receive your money it's quite simple. It's been great dealing with the team at Fraction.
Obtaining our mortgage was straightforward, seamless, and bought us much-needed time. We highly recommend Fraction.
We were very thankful that our mortgage broker introduced us to Fraction as otherwise we would not have been able to re-enter home ownership. Although this is a temporary solution as it will cost quite a bit more in the end, it was the only way for us to get a mortgage and we are happy that it was an option at the time.
Excellent service. Everything was executed perfectly great communication skills with fraction in my mortgage broker and lawyers it certainly has given me great comfort to have switched to fraction. The product that fraction offered me was the perfect solution I am so happy that I made this choice.
I find this product (being able to access equity and not having to make monthly payments) as ideal for my financial situation at the present time. The process was extremely seamless to follow, and the human interaction was cordial and efficient.
We found Fraction through our broker. What an amazing product! We are mortgage free and purchased a 2nd property but weren't prepared to start making huge mortgage payments again. This worked perfectly for us.
My family and I were able to tap into the value in our home, which was not available to us through standard lenders/banks. So far our expected interest rate is holding as the central bank tackles inflation and raises rates. This innovative product allowed us to get into a home we own and bought us time to get our financial circumstance to where we could access traditional lending. Just what we needed when we needed it
I still can’t believe this incredible deal I got which made it possible to purchase my retirement dream home. I have been telling everyone I know about Fraction and recommending you. Thank you so much Daniel and all the professional at Fraction! I look forward to doing more business with you in the future.
Fraction has been the light at the end of the tunnel for me, at least for now and i look forward to a longer relationship
“...Fraction offered us an opportunity that was best for us at this point in our 73-year-old lives, and with the house that we're living in. We're hoping for continued appreciation of our home over the next 5 years, so that this deal will turn out to be a 'win-win' for us, as well as for Fraction. They managed to come up with a brilliant mortgage product, that segues perfectly into what the current mortgage market does NOT offer.”
From start to finish, my experience was no less than stellar. They explained the process, the paperwork, what was going to happen from point to point. Saki was a great guy to deal with and was very understanding of my specific issues and how to overcome them. Highly recommend dealing with Fraction if you are looking for this type of mortgage.
I'm so grateful for fraction, it came right when I needed it. I didn't have to wait till I was 55 years old, I am currently 50. They were helpful and quick, they answered all my questions quickly and in detail. I will definitely do business with them again in the future. Fraction has given me the chance to live my dream life! Thank you Fraction.
I have been dealing with Fraction for about 6 months now and have 5 properties with them. They have helped my husband and I realize our dreams of owning 5 properties. Using the equity in our homes we are able to renovate the properties to our liking. This benefits both Fraction and ourselves by increasing the value of the homes. It's a win, I win!
How a Fraction Mortgage can work for you
A Fraction mortgage is a way for homeowners to access their home equity. Fraction customers have tapped into their home equity for many reasons including:
Debt consolidation
Paying down existing mortgages
Accessing tax-free cash to upgrade or repair their homes
To help their children purchase their first home
Side by side comparison
The main difference between Fraction and a reverse mortgage is that Fraction has a 5 year term and has no age restrictions.
Our mortgage allows you to access a portion of your home’s equity at a fair rate with no monthly payments, while maintaining and retaining your home.
There's no monthly payments and no repayment penalties.
Fraction helps you turn your dreams into reality.
.svg)
Frequently asked questions
Go through our most asked questions below, and visit our FAQs page for more detailed questions.
.svg){kind=icon}
Following a third-party appraisal of your home and a check of all your information, you may or may not be approved for a Fraction Mortgage.
Based on your application and the appraised value of your home, Fraction will determine how much cash you qualify for. Upon a deeper review, we will provide you with documentation outlining your funding amount and corresponding terms and conditions. Once you sign the final documents, we send you your money.
Learn more here, in our Fraction Basics modules.
Unlike most institutions in Canada, we do not use the prime rate for our loans. We use CORRA Swaps.
The prime rate from the Bank of Canada is not an actual rate. Each bank publishes its own prime rate, which is a reflection of its own cost of capital, and is partly informed by the overnight rate set by the Bank of Canada.
The prime rate the Bank of Canada publishes is simply the mode of the published prime rates of the 6 largest banks.
CORRA Swaps, by comparison, are informed by the market and reflect interest rate expectations over the term of each swap rate.
Our 3-year product uses the 2.5 year swap rate, our 4-year product uses the 3.5 year swap rate, and our 5-year product uses the 4-year swap rate. The shorter term for the swaps reflects the expected duration of each of our loan products.
To view the CORRA swap rates yourself, you can visit https://www.chathamfinancial.com/technology/canadian-market-rates#view.
As there are no monthly payments with Fraction's product, it does indeed compound. Interest is charged each day at the daily rate, which is calculated from our posted annual rate.
We will include the daily rate in the final loan documents, but if you'd like to calculate it yourself, you can visit Fraction's rate conversion calculator.
Yes, if you have 60% down on a home, you can work with Fraction to purchase the home with no monthly payments.
Absolutely. If you want to contact the team and ask any further questions about your circumstances, you may contact us at [email protected].
Be sure to include the province you’re inquiring about so we can better assist you.
Often homeowners seek ways to unlock equity in their homes for large expenditures or diversifying income – examples include funding home renovations, consolidating or paying off debt, launching a business, or purchasing a secondary residence.
While in need of solutions, many homeowners aren’t interested in taking on more debt.
Fraction allows them to access the built-up equity in their homes with no monthly payments and an interest rate tied to their local market's value.
The Fraction Mortgage helps homeowners to access the value locked in their homes with no monthly payments.
They can use the cash for anything, from paying off credit-card debt to starting a business to buying a second home.
Learn more here, in our Fraction Basics modules.
Fraction offers no monthly payments and no payment penalties. Unlike reverse mortgages, we have a fixed-length term and do not have any age restrictions.
See how Fraction stacks up against the rest by visiting our blog for more financial product comparisons
Anyone who owns a home and has enough equity built up can work with us. We have no age restrictions.
Since there are so many factors that contribute to partnering with Fraction, each property is evaluated independently. Working with Fraction starts with getting a free estimate. With our estimate tool you can see how much tax-free cash you qualify for, with no impact to your credit score.
From there, after a hard pull credit check (which may impact your credit score) and official appraisal of your home, we’ll send you an agreement for your review. Here are some of the things we screen for before we lend:
- The single-family dwelling is located in a province or state in which we’re currently operational
- A 660 credit score
- A minimum of {{min_equity}} equity in your home
Currently, Fraction lends in British Columbia, Alberta and Ontario.
We've built the Fraction Mortgage with no monthly payments and penalties, no hidden fees, and removed all of the confusing financial jargon to help you find the right financial solution to meet your needs.
We keep things simple and fair for homeowners everywhere. Fraction's terms are clear and simple, and we will walk you through the whole process to make sure you understand everything before you sign.
Plus, Fraction has raised more than USD$250 million from international investors in Canada, the US, and Europe. Our world-class investors share our vision to change how homeownership works.
