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Government Home Equity Access Scheme (HEAS) vs Reverse Mortgage Loans

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Unlock Funds with the Home Equity Access Scheme

Formerly known as Pension Loan Scheme or PLS, The Home Equity Access Scheme, or HEAS, is a government-backed loan scheme that offers older Australians a financial safety net. It is often referred to as ‘the government Reverse Mortgage’.

Whilst it has elements in common with Reverse Mortgage loans such as compounding interest, it is actually a loan of pension entitlements, and as such is not a regulated credit product.

It aims to help those who are receiving Age Pension by offering a loan of further entitlements, in the way of fortnightly additional payments (or small lump sums). This income stream is generated by borrowing against the equity of their home.

Unlike traditional mortgages, the loan’s repayment is often deferred until the home is sold or the borrower passes away.

Benefits of the ‘Government Reverse Mortgage’ (HEAS)?

One of the biggest benefits of HEAS is its security and simplicity. As a government-backed home equity release scheme, it arguably offers greater ease of use and stability to borrowers compared to some private sector options.

Below are other benefits of HEAS:

  • No Tax on equity drawdowns:
    One of the standout perks of the HEAS is that it allows borrowers to increase their cash flow without worrying about taxes. These home equity drawdowns feel like tax-free ‘income’ and are a significant advantage for pensioners who want to boost their finances.
  • Keep Your Home:
    With the HEAS, borrowers continue to own their homes and live in them. This feature offers a sense of security and comfort, particularly critical during the golden years of retirement.
  • Borrowing with Boundaries:
    The HEAS comes with a No Negative Equity Guarantee, which places a cap on the amount you can borrow. This protective measure discourages over-borrowing and safeguards borrowers from potential financial turmoil down the road.

See here: https://www.servicesaustralia.gov.au/home-equity-access-scheme

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Reverse Mortgages vs. Government HEAS: Which Is Right for You?

If you're considering a government-backed loan like the Home Equity Access Scheme (HEAS), it's important to know the key differences between HEAS and a Reverse Mortgage.

Home Equity Access Scheme (HEAS)

  • Approval Time: 2 to 3 months
  • Loan Amount: Capped at $13,350 for singles, $20,850 for couples
  • Flexibility: Limited options for receiving funds (fortnightly payments, small lump sums)
  • Eligibility: Must be of Age Pension age and meet strict government criteria
  • Access to Funds After HEAS: Takes up to 3 months to close the HEAS loan
  • Government Regulation: Not regulated under credit law but offers protections like the No Negative Equity Guarantee.
  • Interest Rate: Lower interest rate

Reverse Mortgage

  • Approval Time: 5 to 7 days
  • Loan Amount: Higher loan amounts available
  • Flexibility: Flexible—lump sum, regular payments, or both
  • Eligibility: For homeowners, typically 60+ years of age
  • Access to Funds After HEAS: Funds available faster once HEAS is closed
  • Government Regulation: Regulated under the National Consumer Credit Protection (NCCP) code
  • Interest Rate: Potentially higher interest rates compared to HEAS
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When a Reverse Mortgage May Be the Better Option

When deciding between a Reverse Mortgage and the government's HEAS, it’s essential to consider which option better aligns with your financial needs and goals. Here are some important factors that may make Reverse Mortgages the more attractive choice:

  • Urgency of Funds:
    If you need access to funds quickly, Reverse Mortgages generally offer faster approval and disbursement times. While the HEAS can take up to 2-3 months for approval, private lenders tend to process Reverse Mortgage applications more swiftly, which is particularly helpful in urgent situations where time is a critical factor
  • Larger Loan Sizes:
    Reverse Mortgages allow for much larger loan amounts compared to the HEAS. The HEAS has strict limits on how much you can borrow, which may not be enough if you have substantial financial needs. On the other hand, Reverse Mortgages provide more flexibility, enabling you to access more of your home equity without the same level of restriction.
  • Cash Reserve Feature:
    One of the standout benefits of Reverse Mortgages is the 'cash reserve' feature, which is not available under the HEAS. This feature acts as a line of credit, allowing you to have equity set aside for future use without being charged interest until you actually withdraw the funds. It provides a higher level of flexibility and peace of mind, knowing that extra funds are available when needed without immediately increasing your loan balance.
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Interested in Reverse mortgage?

Answer a few short questions to find out if you qualify for a reverse mortgage.

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Rated 4.9 stars on

“Sincere thanks to Andrew and Seniors First .. the loan has been life changing.”

Deborah Collett

Johanne Slattery
11:55 06 Mar 25
Dealing with Bill James was a pleasant and efficient process. Bill assisted me above and beyond to achieve a successful outcome.I highly recommend dealing with him and benefiting from his knowledge of the market.
Brian Hughes
06:30 05 Mar 25
Recently I had the pleasure of takeing a reverse mortage out with Seniors First for the very first time. I found Seniors First to be more than helpful to go the extra mile to take the time to explain all the aspects of doing so with them. I had the major assistance of Broker Dean Hukins who I found to be a great represenative of Seniors First and would reconmend anyone comsidering taking a reverse mortage to try Seniors First .
Barb Owen
09:47 03 Mar 25
Linda Alexander
07:12 24 Feb 25
Andrew has surpassed all expectations. It was not easy for him however he came through with flying colours. I would recommend him to anyone that needs prompt help with expert information. We thank you.
Poo Guy
21:23 19 Feb 25
Our broker Adam Oakley was fantastic. He was always prompt to answer any questions we had. Which made the process so easy.
Andrew Robinson
00:15 13 Feb 25
I have recently obtained a reverse mortgage from seniors first,Palka Kuma was my contact and from start to finish she was absolutely amazing being so committed to ensure a positive outcome,her knowledge and patience was excellent,thank you Palka and seniors first.🙏
L ALLARD
00:17 10 Feb 25
Being new to the concept of getting a reverse mortgage, Bill James was a fantastic advisor. He was honest about the advantages and disadvantages, and showed sound knowledge and expertise.I can highly recommend Bill, he was a delight to deal with.
Karin Wise-Jarvis
21:26 03 Feb 25
Seema was very helpful with my application, but best of all, she was always available to answer my calls and many questions.A great lady to deal with- highly recommended.
Noel Rippon
02:51 22 Jan 25
Totally professional experience.I wish to thank Andrew Cate for guiding us through the complexities of our equity loan.Andrew delivered thorough, informative advice & instructions while maintaining a clear dialogue, (In layman's terms) ,that we could understand.Even when we were unclear on some points, he displayed patience & understanding clarifying matters, which we found very reassuring.I cant speak highly enough of Andrew's professionalism and approachable manner." One of the best in the business".CheersNoel & Jenny
Melanie and Jeremy Dosser
00:09 10 Jan 25
Thank you so much to Richard from Seniors First for guiding my Mum through the very complex process of applying for a Reverse Mortgage so she could stay in the home she loves so much. So glad we had his direction as the process was very different to a standard mortgage and took significantly longer than we anticipated at the beginning. Very happy with the outcome and highly recommend engaging Seniors First to help with the process.
Thomas van Oosterom
19:56 09 Jan 25
Palka of Seniors First acted as my wife and I’s broker to advise and guide us through the process of obtain a Reverse Mortgage. Her knowledge, experience, patience and dedication to the process was quite incredible. We have both been involved in careers at a reasonable level and Palka proved to be one of the best and most professional person we have ever dealt with. We highly recommend her and her services. Thomas & Kim
Marilyn Carstens
04:06 07 Jan 25
Palka is an amazing person and so caring and helpful. I would highly recommend her anytime
Sharon Hutchinson
01:56 07 Jan 25
I was so impressed with the service provided by Seniors First broker Angela Giorkaris. I was kept informed of progress throughout. Thank you
Rhondda Deer
12:37 04 Jan 25
Thank you to Seniors First and especially to Dean Hukins for your guidance through my reverse mortgage application. Dean was always available to help with any questions and concerns and made a daunting process very easy. Everything went through without a hitch. Thanks again Dean.
md hasib
09:33 29 Dec 24
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*Note: Seniors First is a licensed, finance broker specialising in Reverse Mortgage and equity release finance. It is not affiliated with Centrelink, or an agent for the Home Equity Access Scheme. The webinar is for informational purposes only to assist in the understanding of how commercially available Reverse Mortgages differ from the Home Equity Scheme, and the circumstances in which they might be a suitable choice.

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