HOME EQUITY
Home Equity Access Scheme: turn home equity into fortnightly income or a lump sum
A government loan secured against your home — at a lower rate than a bank reverse mortgage — that tops up your pension without you having to sell or move. Here’s how the numbers actually work.
OFFICIAL RULES CHECKED 22 AUGUST 2026
How much you can borrow.
The Home Equity Access Scheme (formerly the Pension Loans Scheme) lets Age Pension age Australians borrow against equity in Australian real estate — most commonly the family home — as a fortnightly payment, a lump sum advance, or a combination of both. It’s run by Services Australia, not a bank.
| Feature | Detail |
|---|---|
| Interest rate | 3.95% per annum, compounding fortnightly on the loan balance |
| Maximum combined income | Your pension plus loan payment can’t exceed 150% of the maximum pension rate |
| Lump sum advance | Up to 50% of the maximum annual pension rate, once every 26 fortnights |
| Who can apply | Age Pension age or older — you don’t need to already receive the Age Pension |
| Security | A registered charge over Australian real estate you own |
| Repayment | Not required while you live in the home — the loan plus compounding interest is repaid from your estate or when the property is sold |
Why the rate matters so much.
At 3.95% compounding, a loan roughly doubles in real terms over 18 years. That’s still meaningfully cheaper than most commercial reverse mortgages, which have historically run several percentage points higher — but it’s not free money, and it reduces what’s left in your estate. It suits people who want to stay in their home and need extra cash flow, not people looking to maximise inheritance.
Worked example
Ron and Denise, both 72, receive a part Age Pension of $1,200 a fortnight combined and own their $900,000 home outright. They want an extra $400 a fortnight for living costs. Because their combined pension plus loan can’t exceed 150% of the maximum couple rate, they have plenty of room — the scheme tops up their fortnightly income to $1,600 without touching their super or selling anything.
Frequently asked questions
Does the loan affect my Age Pension assets test?
No. Money you draw isn’t means-tested — it’s a loan, not income or an asset you hold.
Can I pay it back early?
Yes, in part or in full, at any time, without an exit fee.
What happens if the loan grows bigger than my home’s value?
A no negative equity guarantee applies — you (or your estate) will never owe more than the home is worth when it’s sold.
Can I still get the Home Equity Access Scheme if I don’t get any Age Pension?
Yes — self-funded retirees over Age Pension age can also apply, up to 150% of the maximum pension rate.
Apply this to your own plan.
Pension Pilot’s calculator can factor a Home Equity Access Scheme drawdown into your income projections alongside your Age Pension, so you can see the long-term cost against the extra cash flow. These figures are educational and should be checked against official Services Australia sources before you apply.