Security for the loan

Your security for the loan is the market value of the Australian property you offer less any mortgage or encumbrance.

How much you can use

You can choose how much you want to use as security for your loan.

If you choose to exclude a portion of the security amount offered, it’ll reduce the maximum loan you can get.

You can make a request to change the excluded amount at any time. You must make this request in writing. You and any other people, trusts or companies who have ownership in the property must sign it.  

If you’re a member of a couple, your partner must sign the request even if they don’t own the property.

Read about how the Age component also impacts how much you can get.

What you can use as security

You can only use real estate in Australia as security for your loan.

It can be the home you live in or an investment property you or your partner own.

It can also be real estate owned by a company or trust. Either you or your partner must be an attributable stakeholder of the company or trust.

We may consider property in a retirement village as adequate security if the following apply:

  • you or your partner’s name is on the freehold title for the property
  • there isn’t a contract term that prevents or limits your ability to sell the property
  • you or your partner’s estate control the distribution of the asset.

You need to tell us if you have any of the following, as this may affect your eligibility:

  • mortgage
  • reverse mortgage
  • any other liabilities for the property you use as security.

You’ll need to get consent for the property you use as security if:

  • you have a partner
  • the real estate used as security has any co-owners.

You can choose how much of your real estate value you want to use as security. If you have more than one property, you can choose which ones you want to include as security.

There is no cost to you if:

  • a licensed valuer needs to assess the property
  • we need to re-assess the value at any time.

We’ll register a charge or caveat with the Land Titles Office on the title deed of the property you’re using as security. You’ll have to pay any costs associated with registering and removing the charge or caveat. We add these costs to your loan balance and they will accrue interest. You can repay the costs at any time.

We use the value of your real estate to assess your eligibility and rate for social security payments or benefits. We deduct the amount you owe under the scheme from the value of your real estate used as security for the loan. This means that the value of your assessable assets may decrease. 

You must tell us if you decide to change the real estate you offered as security for the loan. You’ll need to give us a written and signed declaration. This can be from either you or the person you have legally appointed to manage your real estate affairs.

Call us on the Older Australians line if you want to sell the property used as security for the loan. That way we can provide the loan payout amount and prepare to remove the charge or caveat on the property.

When you incur costs

You’ll be responsible for all costs you incur.

The property you offer as security for the loan will have a charge or caveat placed on the title.

Any costs incurred in registering and removing the charge or caveat are payable by you. We’ll add these costs to your loan balance and you can repay them at any time.

We’ll send you a letter telling you the costs once the loan has commenced.

You won’t incur any costs for property valuations.

Page last updated: 28 January 2020