Equity Release · Reverse Mortgages · HEAS
Reverse Mortgages and Equity Release: Know the Real Cost
Asset rich and cash poor? A reverse mortgage or the Government’s Home Equity Access Scheme can turn home equity into income while you stay put.
Both can help. Both also cost more than most people expect over time. Here is what to weigh up.
What Is a Reverse Mortgage?
A reverse mortgage is a loan secured against your home that you usually do not repay until you sell, move into aged care or pass away. There are no regular repayments.
That sounds attractive, but the interest is added to the loan and compounds. The balance grows every year, eating into your equity and what you leave to your family. Rates and fees are usually higher than a standard home loan.
Since 2012, reverse mortgages in Australia must include a statutory negative equity protection, so you cannot owe more than your home is worth when it is sold. Lenders must also show you projections of how the debt could grow.
The Home Equity Access Scheme
The Home Equity Access Scheme (formerly the Pension Loans Scheme) is a Government loan available to people of Age Pension age who own property in Australia. You do not need to receive a pension to use it.
- Fortnightly payments of up to 150% of the maximum Age Pension, combined with any pension you receive.
- Lump sums of up to 50% of the maximum annual Age Pension in any 26-week period.
- Interest compounds at a Government-set rate that is usually below commercial reverse mortgage rates.
- A no-negative-equity guarantee applies.
Check the current rate and limits with Services Australia before you apply.
Is There a Better Way?
Before borrowing against your home, the bigger question is: why are you asking, and what do you need now and later? Often there is a better path:
- Downsize and release equity without debt, possibly adding to super with the downsizer contribution.
- Build a backyard home and rent out the main house, or the reverse, for an income. See how.
- Sell part of the land if your block can be subdivided.
- Invest part of the equity in a property that pays rent, through properT network.
What is the rate and is it fixed or variable? What are all the fees? What will the balance be in 5, 10 and 15 years? Can family stay on if I move into care? What happens if I want to repay early?
Further reading: Reverse mortgage or equity release? and retire and downsize without a mortgage. Use ASIC Moneysmart’s reverse mortgage calculator to model how the debt grows.
No obligation
Weighing Up Equity Release?
Talk to us before you sign anything. We will lay out the alternatives side by side and connect you with a licensed credit adviser for the loan itself.
Prefer to call? 0413 108 125
Compare your options
Other Ways to Unlock Your Home
Invest Your Equity
Put freed-up equity to work in an income-producing investment property.
properT networkSources: Services Australia: Home Equity Access Scheme; ASIC Moneysmart: reverse mortgages. General information only, current as at October 2026. Rules change: confirm your position with a licensed adviser.
One Network. Nationwide Reach.
Part Of The properT network Family
Downsizing for Retirement is one specialist site within the properT network group: the same independent advisory approach, applied across states and property types.