Retiree Reverse Mortgage Boom Retirees are jumping at the chance to use their home equity to enjoy a better quality of retirement with a 60% increase in participants in the government’s reverse mortgage scheme.
In June 2022 there were 6041 participants in the Home Equity Access Scheme compared to 9750 participants in June 2023.
The total value of the money drawn under the scheme by participants was $240 million in June 2023.
The Scheme allows pensioners to receive an income stream or lump sum payment, with their home or investment property as collateral.
A ceiling is put on the amount which is able to be drawn, taking into account the value of the house.
When the house is sold, the loan is repaid from the proceeds.
Participants can receive up to 150% of the maximum age pension, minus any age pension received.
About 75% of participants to date were on a full-age pension, a fifth are on a part-age pension and the remainder are self-funded retirees.
