Plenty of older Australians are what financial planners call “asset rich, cash poor”. The house is worth a small fortune, the pension covers the bills, and there’s nothing left over for the new hearing aids, the roof repair or the trip to see the grandkids in Perth.
The Home Equity Access Scheme (HEAS) is the government’s answer to that problem. It’s a loan from Services Australia, secured against your home, paid as a fortnightly top-up, a lump sum, or both. You don’t repay anything until you sell or die. It’s cheaper and more tightly controlled than a commercial reverse mortgage, but it isn’t free money, and the interest adds up faster than most people expect.
Who can get it
According to Services Australia, you must meet all of these:
- you or your partner are Age Pension age or older
- you get, or are eligible for, a qualifying pension (this includes people who qualify for the Age Pension but get nothing because their income or assets are too high)
- you or your partner own Australian real estate that can be used as security
- nobody on the title is bankrupt or under a personal insolvency agreement
- the property is insured for at least 90% of the value of the buildings
That second point surprises people. You don’t have to be on a pension to use HEAS. Self-funded retirees who would qualify for the Age Pension except for the means tests can borrow too.
The current interest rate
The rate is 3.95% a year, compounding every fortnight on the outstanding balance. The Minister for Social Services sets it, and Services Australia says it will tell borrowers if it changes. Check the HEAS interest rate page for the latest figure.
On top of interest, you repay any legal costs added to the loan.
How much you can get each fortnight
The key rule is 150%. Your combined pension plus HEAS loan payment can’t be more than 1.5 times the maximum pension rate (including supplements) each fortnight.
From 20 September 2026, the maximum Age Pension is $1,237.70 a fortnight for a single person and $1,866.00 combined for a couple. That gives these ceilings:
| Situation | Max pension (per fortnight) | 150% ceiling | Max HEAS on top of a full pension |
|---|---|---|---|
| Single | $1,237.70 | $1,856.55 | $618.85 |
| Couple (combined) | $1,866.00 | $2,799.00 | $933.00 |
If you’re on a part pension, you can borrow more to bring the total up to the same ceiling. If you get no pension at all, you can borrow up to the full 150% as a loan. Pension rates change every March and September, so the dollar figures will move. The how much you can get page and the HEAS calculator have the current numbers.
There’s also an overall cap, the maximum loan amount. It’s based on your age (or your younger partner’s age) and the value of the property you offer as security. It rises as you get older. Once your balance hits it, payments stop, though interest keeps running.
Lump-sum advances
You can also take part of the loan as a lump sum. The rules, per the advance payments page:
- you can advance up to 50% of the annual maximum pension rate in any 26-fortnight period
- you can take that as one payment or two, but no more than two advances in 26 fortnights
- taking an advance reduces your fortnightly loan payments for the next 26 fortnights
Using Services Australia’s own worked examples on rates from 20 September 2026, that’s up to $16,090.10 for a single person and up to $12,129 for each member of a couple.
Two catches. The advance counts as a financial asset for pension purposes, so it’s deemed under the income test and assessed under the assets test. If you used your principal home as security, it’s exempt from the assets test for the first 90 days only. So if the money sits in your bank account, it can trim your pension. Spend it on what you took it for.
The no-negative-equity guarantee
HEAS loans carry a no-negative-equity guarantee. When the debt is settled, you or your estate won’t have to repay more than the market value of the property, less any other mortgages or legitimate claims. Services Australia’s example: a $250,000 debt on a house that sells for $200,000 means you repay $200,000.
The guarantee can be lost if you increase a mortgage or other encumbrance on the property, misrepresent your circumstances or commit fraud. Tell Services Australia early if you plan to sell or change a loan on the property. Details are on the repaying your loan page.
The real cost: compound interest
This is the bit glossy summaries skip. Because you’re not making repayments, interest is charged on interest, every fortnight, for as long as the loan runs.
Services Australia’s own example at 3.95%: someone takes $750 a fortnight for 10 years. They receive $195,000. The balance after 10 years is $239,269.71, so more than $44,000 is interest. In its 15-year example, $526,500 drawn becomes a debt of $718,810.81.
And the interest doesn’t stop when you stop drawing. If you hit your maximum loan amount at 80 and live to 95, the balance keeps growing for those 15 years. That money comes out of your estate, which can affect what’s left for your family, or what’s left for you if you later need to fund an aged care deposit.
When the borrower dies, Services Australia generally seeks repayment from the estate after 14 weeks. It may defer repayment if a surviving partner is Age Pension age and still living in the property, but interest keeps accruing.
HEAS versus a commercial reverse mortgage
| Home Equity Access Scheme | Commercial reverse mortgage | |
|---|---|---|
| Lender | Services Australia | Bank or specialist lender |
| Interest rate | 3.95% p.a., set by the Minister | Set by each lender; generally well above the HEAS rate |
| Fees | Legal costs added to the loan | Establishment and ongoing fees vary by lender |
| Who can borrow | Age Pension age, qualifying for a pension | Lender criteria; most won’t lend under 60 |
| How you get the money | Fortnightly, capped lump sums, or both | Lump sum, income stream, line of credit or a mix |
| How much | Capped by the 150% rule and the maximum loan amount | Based on age and loan-to-value limits; larger lump sums are possible |
| No-negative-equity protection | Yes | Yes, for loans since 18 September 2012 |
Our honest take: if you want a steady top-up to your income, HEAS is usually the cheaper option and hard to beat. A commercial reverse mortgage mainly makes sense if you need a larger lump sum than the HEAS advance limits allow, say for major renovations or to pay out an existing mortgage. If you’re comparing, use ASIC’s Moneysmart reverse mortgage calculator. Lenders are required to take you through it before you sign.
Alternatives worth a look first
Before borrowing against the house, it’s worth checking whether you’re getting everything you’re already entitled to. Working a few hours? The Work Bonus lets you earn more without losing pension. Wondering why your part pension is lower than expected? Deeming rates might be the reason. And if the house is simply too big, selling and using the downsizer super contribution might suit you better than borrowing against it.
Services Australia’s Financial Information Service can walk you through the options for free, and it’s worth getting independent financial or legal advice before applying.
FAQ
Do I have to make repayments on a HEAS loan?
No. You can repay part or all of it at any time, but you don’t have to. The loan is usually repaid when the property is sold or from your estate.
Can I get HEAS if I don’t receive the Age Pension?
Yes, if you meet the rules for a qualifying pension but your rate is zero because of the income or assets test. You can then borrow up to 150% of the maximum pension rate each fortnight.
Will a HEAS lump sum reduce my pension?
It can. Advance payments are deemed under the income test and assessed under the assets test. If your principal home secures the loan, the advance is exempt from the assets test for the first 90 days only.
Can my children end up owing more than the house is worth?
No. The no-negative-equity guarantee means the debt can’t exceed the property’s market value, less other legitimate claims, unless you breach the conditions such as increasing another mortgage or misrepresenting your situation.
This article is general information only and isn’t financial or legal advice. Rates, payment limits and rules change, so check the Services Australia pages linked above and consider independent advice before applying.
