Home Equity Access Scheme (HEAS) explained

The HEAS can be a useful way to supplement your retirement income using the equity you have built up in your home. It allows you to receive a non-taxable fortnightly payment from Services Australia or the Department of Veterans’ Affairs (DVA) from a loan against your home.

You are also able to get an advance payment (lump sum) from your loan in addition to, or instead of, your fortnightly loan payments (see Point 3 below).

A No Negative Equity Guarantee applies to all HEAS loans. This means you (or your estate) are protected from owing more on your reverse mortgage than your home is worth. 

The maximum fortnightly income you can receive from your Age Pension and HEAS loan combined is 1.5 times the full rate of the Age Pension. This means:

• Full-rate pensioners can borrow up to 50% of the maximum payment rate for the fortnightly full-rate pension (including supplements).
• Part-rate pensioners can withdraw fortnightly payments of up to a maximum of 150% of the full-rate Age Pension less the amount of their current fortnightly pension payments (including supplements).
• Self-funded retirees can borrow up to 150% of the fortnightly full-rate Age Pension.

10 key facts

Here are 10 important points you need to know about how the HEAS operates:

1. Who is eligible?

You can apply for a HEAS loan if you meet all the following eligibility criteria:

• You or your partner are 67 or more 
• You must be receiving – or qualify for – a qualifying pension. You are still eligible for the HEAS if you don’t receive a payment from Centrelink because of means testing. Qualifying pensions include:
  • Age Pension
  • Carer Payment
  • Disability Support Pension
• You or your partner must provide Australian real estate as security for the loan (see Point 6)
• You must have adequate and appropriate insurance covering the property you are providing as security
• You, your partner and any co-owner of the property must not be bankrupt or subject to a personal insolvency agreement.

2. Payments are a nominated amount

You nominate your own fortnightly loan payment amount, up to the maximum that applies to you. If you don’t need the maximum, you can choose to receive a smaller amount, so your loan balance builds up more slowly.

3. Lump sums are available

The scheme allows participants to apply for up to two lump sum advances each year. The maximum advance in a one-year period is 50% of the full rate of the annual Age Pension.

Advance payments reduce the maximum fortnightly HEAS payment available to you and are assessable in Centrelink means tests, generating deemed income and being counted as an assessable asset until you have spent the amount. If your HEAS loan is secured against your principal residence, advance payments are exempt from the assets test for the first 90 days.

4. Loans are from the government

The HEAS is administered by Services Australia and eligible retirees receive the loan payments from the federal government.

Payment amounts received from a HEAS loan are not taxable.

5. Maximum loan limits apply

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The amount you can borrow under the HEAS is limited to help ensure you don’t end up owing more than your home is worth.

Your maximum loan amount (MLA) is limited by:

• Your age and, for couples, the age of the younger spouse or partner at the time the loan is granted
• The value of the property you offer as security
• How much equity you have in the property and any amount of equity you wish to exclude from the loan.

The maximum loan amount generally increases each year as you or your partner get older and is also linked to any changes in the value of the real estate you are borrowing against. Your property is revalued annually at no cost to you.

HEAS recipients must notify Centrelink or the DVA within 14 days if there is any change in circumstances affecting the real asset being used to secure the loan.

To work out your maximum loan amount, use Centrelink’s Home Equity Access Scheme calculator. For guidance on how the calculator works, check our video guide.

6. Real estate is needed as security

To qualify for a HEAS loan, you or your partner must have equity in a property you can use as security for the loan.

The property can be your own home, an investment property, or farmland, but it must be in Australia. The real estate can be owned by a company or trust, but either you or your partner must be an attributable stakeholder of the company or trust.

Property in a retirement village may be accepted as security if you or your partner’s name is on the freehold title of the property, you are not contractually prevented from selling the property, and you or your partner’s estate controls the distribution of the asset.

You can choose how much of the value of your property you want to use as security for your loan.

7. Interest rates are low

Since 1 January 2002, the interest rate on HEAS loans has been 3.95%*. This rate is a significantly lower rate than comparable reverse mortgages (and even traditional mortgages) in the open market.

The rate is variable and can change in the future. Rates for previous periods are shown in the table below.

*Rate current on 28 August 2025 

Source: Social Security Guide, 10 August 2020, Australian Government.

The interest for a HEAS loan is added to your outstanding loan balance each fortnight until the loan balance is fully repaid.

8. Loans are repayable at any time

HEAS loan debts can be repaid in full or in part at any time, however, they are generally repaid when the home used as security for the loan is sold. For most HEAS participants, this usually occurs after they die when their estate is wound up.

9. Your Age Pension payment rate could be affected

Fortnightly HEAS payments won’t immediately impact your Age Pension because they are not counted in the income test.

Your pension can, however, be reduced if you don’t spend your fortnightly payments and money builds up in your bank account. Your bank balance is assessable as an asset and generates deemed income in the income test. Similarly, if you use your payments to buy assessable assets, those assets could reduce your pension.

Any advance payment is assessable in the assets test immediately if the property you used as security is not your home. If your home is your security, the advance is exempt from the assets test for 90 days. All advances generate deemed income in the income test immediately. If you spend some of your advance payment, you need to notify Centrelink (either via myGov or over the phone) so your assessment can be adjusted.

Spending your advance on regular bills or home improvements means the amount is no longer assessable and won’t reduce your pension, but if you use it to buy assessable assets (like a car or caravan), your payment could reduce.

If your HEAS loan is secured against an investment property, your Age Pension entitlement may increase. This can occur because the outstanding loan balance reduces the value of the property in the assets test.

10. Few fees

There are no establishment or monthly account fees with a HEAS loan, which compares with around $1,000 for a normal home loan mortgage.

Even so, Services Australia or DVA may charge you some costs (primarily legal fees) when the loan commences and when it is discharged. These are mainly costs associated with registering and removing the charge or caveat that the government will place on your property’s title deed.

Setting up a HEAS loan requires a valuation of your property by a licensed valuer, but you will not pay this cost.

The costs charged by Services Australia or DVA are determined after the loan application is made and can be paid immediately, but most people choose to add them to the loan balance.

The bottom line

Borrowing using the Home Equity Access Scheme is worth a look as an alternative to selling investment property or downsizing your home if you’re in need of extra retirement income.

Low interest rates and no ongoing fees make the scheme attractive, but limited lump sum withdrawals and relatively low maximum fortnightly payments mean it won’t suit everyone.

As with any reverse mortgage, it’s important to consider how the loan will compound over time and reduce the value of your property available to later pass to beneficiaries or use towards a lump sum aged care deposit.

For advice, you can speak to a licensed financial planner or apply for the scheme (with no obligation to proceed) to talk to a specialist at Centrelink who will ensure you are fully informed before you enter a loan agreement.