HOME EQUITY
Home Equity Access Scheme: retirement loan basics
The Home Equity Access Scheme, formerly the Pension Loans Scheme, is a government loan secured against Australian real estate. It can provide eligible people with payments in retirement, but interest, borrowing limits, security and eventual repayment need careful consideration.
KEY RULES REVIEWED 5 OCTOBER 2026
How much you can borrow.
The Home Equity Access Scheme is a government loan secured against eligible Australian real estate. You or your partner must be Age Pension age or older; qualifying-pension, residence, property, insurance and other conditions apply. Payments may be fortnightly, lump-sum advances or both. Services Australia administers the scheme, with a DVA pathway for eligible veterans.
| Feature | Detail |
|---|---|
| Interest rate | 3.95% per annum, compounding fortnightly on the loan balance |
| Maximum fortnightly pension-plus-loan payment | Your pension plus loan payment can’t exceed 150% of the maximum pension rate |
| Lump sum advance | Up to 2 advances in any 26-fortnight period, within a total cap of 50% of the maximum annual rate of your qualifying pension. Advances can reduce later fortnightly loan payments. |
| Who can apply | People who meet the scheme’s age, residence, qualifying-pension and property-security requirements. Receiving an Age Pension payment is not always required. |
| Security | Eligible Australian real estate owned by you or your partner is used as security, with a charge or caveat registered as required. |
| Repayment | Voluntary part or full repayment is possible. On sale, the loan may be transferred to another property or repaid at settlement. Outstanding debt is generally recovered from your estate, subject to relevant deferral rules. |
Why the rate matters so much.
For a fixed balance, 3.95% annual interest compounded fortnightly would roughly double the debt in 18 years in nominal dollars, assuming no rate changes, extra borrowing, fees or repayments. This is not an inflation-adjusted forecast. Further payments increase the balance, and interest continues until the debt is repaid. Review the official interest rules and get independent financial advice before deciding whether the scheme fits your circumstances.
Worked example
Illustrative example: Ron and Denise, both 72, receive a combined pension of $1,200 a fortnight and would like a $400 fortnightly loan payment. This would bring their cash flow to $1,600 a fortnight and create a growing loan balance. Being below the payment cap alone does not establish approval: Services Australia also checks eligibility, property security and the maximum loan amount.
Frequently asked questions
Does the loan affect my Age Pension assets test?
It can. A lump sum advance is subject to deeming and the assets test. If your principal home secures the loan, the advance has a 90-day assets-test exemption. Spending or investing the money can change its treatment. Read the official advance-payment rules and keep Services Australia informed.
Can I pay it back early?
You can repay part or all of the loan at any time. Check the payout and property-security release process with Services Australia.
What happens if the loan grows bigger than my home’s value?
A no negative equity guarantee can limit repayment at settlement to the secured property’s market value less other mortgages or legitimate claims. Conditions and exclusions apply, including misrepresentation, fraud and certain changes to encumbrances. See the repayment and guarantee rules.
Can I still get the Home Equity Access Scheme if I don’t get any Age Pension?
Some self-funded retirees can qualify even if no Age Pension is payable. The scheme’s eligibility, security and borrowing limits still apply; confirm your circumstances with Services Australia.
Apply this to your own plan.
Use Pension Pilot to organise your broader retirement assumptions. For scheme-specific borrowing amounts, interest and advance-payment effects, use the official Services Australia resources and seek independent financial advice. A Pension Pilot estimate does not establish HEAS eligibility or loan approval.