Pension Loans Scheme
A scheme that lets older Australians get a voluntary non-taxable fortnightly loan from us. You and your partner may use this to supplement your retirement income.
You need to use Australian real estate as security for the loan. To help you decide whether to apply for the loan payment, you can use both of our calculators:
You can choose the amount of loan payment you get each fortnight. We don’t pay the loan amount as a lump sum.
You must repay all of these to us:
- the loan amount
- some legal costs
- accrued interest.
You’ll have to pay interest on the loan. We charge an annual interest rate of 4.5%. This rate compounds each fortnight on the outstanding loan balance. The longer you take to repay the loan, the more interest will accumulate.
There are costs to start and exit the loan. The amount you need to pay depends on your circumstances. We work out the costs based on how many and the type of properties you use as security for the loan. For example if you use one property as security for your loan, you’ll have one set of costs. If you use 2 properties as security, you’ll have 2 sets of costs – one for each property.
You can make repayments at any time, but you don’t have to. You can instead wait and pay it in full when you sell the property. But remember, the longer you have the loan, the more interest you’ll need to pay.
You can ask us to stop your loan payments at any time.
The loan payment you can get each fortnight under the Pension Loans Scheme (PLS) depends on how much pension you get.
There are things you need to think about before applying for the Pension Loans Scheme (PLS).
Complete the following steps to apply under the Pension Loans Scheme (PLS). Before you start, check if you're eligible.
Page last updated: 5 July 2021
This information was printed 21 July 2021 from https://www.servicesaustralia.gov.au/individuals/services/centrelink/pension-loans-scheme. It may not include all of the relevant information on this topic. Please consider any relevant site notices at https://www.servicesaustralia.gov.au/individuals/site-notices when using this material.