With the dramatic rise in the cost of living – 4.2% than 12 months ago – retirees have a new way to boost their retirement income.

Services Australia’s The Home Equity Access Scheme, a rebranded Pensions Loan Scheme, came into being on 1 January, and it does just that.

The Home Equity Access Scheme is a reverse mortgage style loan that allows borrowers of Age Pension age to receive a tax-free fortnightly income stream by taking out a loan against the equity in their home.

It allows the recipient to receive the fortnightly pension plus a loan of up to 150% of the maximum fortnightly rate of the pension.

Self-funded retirees can get the whole 150% of the pension as a loan, while those on the maximum rate of Age Pension can get 50% of the pension as a loan.


Joyce is a single pensioner who currently receives $120 service pension per fortnight. She can use a Home Equity Access Scheme to increase her payments to 150% of the maximum single rate of service pension, which is $1,539.75 per fortnight. Joyce can receive Home Equity Access Scheme loan payments of up to $1,419.75 per fortnight, which is $1,539.75 minus the $120 pension she receives.

The payments accrue as a debt secured against the person’s nominated Australian real estate. This debt accrues interest, with safeguards limiting the maximum loan a person can accrue. Participation in the Scheme is entirely voluntary.

The debt is generally recovered from the sale of the secured property (unless it is transferred to a new property), or from the participant’s estate, although voluntary repayments can be made at any time.

The compound interest rate for the Home Equity Access Scheme is currently 3.95% per annum.