As Australians approach retirement, many seek ways to enhance their financial situation without losing the comfort and security of their homes. Centrelink’s Home Equity Access Scheme (HEAS) offers a solution that allows seniors to access funds from the equity in their properties.
This program enables eligible individuals to receive regular payments or lump sums, making it a flexible and low-risk option for those wishing to maintain financial independence during their golden years.
In this comprehensive guide, we’ll walk you through all the essential details about HEAS in 2025—including the benefits, eligibility criteria, recent updates, payment options, and a step-by-step application process.
What is the Home Equity Access Scheme (HEAS)?
Formerly known as the Pension Loans Scheme, the Home Equity Access Scheme (HEAS) is a government-backed initiative that provides non-taxable loans to older Australians.
By leveraging the equity in their homes, seniors can receive additional financial support to supplement their pension or income, all while continuing to live in their homes.
How Does HEAS Work?
HEAS provides an option for individuals who are not receiving enough from their pension or are not receiving a pension at all. The scheme helps bridge this financial gap by offering access to a loan secured against the equity in the home.
This is especially useful for seniors who want to increase their retirement income without the need to sell their homes.
Eligibility Criteria for the Home Equity Access Scheme
To apply for HEAS, applicants must meet the following criteria:
- Age: You must be at the Age Pension age or older (currently 67 years old).
- Property Ownership: You must own property in Australia.
- Financial Standing: You cannot be bankrupt or under a personal insolvency agreement.
- Residency: You must meet residency requirements.
Even if you are not receiving a pension, you may still be eligible to apply if you are eligible for one or meet the required criteria.
Loan Amount and Payment Options
The total amount you can access through HEAS and your Age Pension payments cannot exceed 150% of the full Age Pension.
Payment Options Available
- Fortnightly Payments: You can opt for regular payments.
- Lump Sum: You can receive a lump sum payment (up to 50% of the full pension over 26 fortnights).
- Combination of Both: A combination of regular and lump sum payments.
For instance, if you’re eligible for a full Age Pension of $1,100 per fortnight, you could receive up to $1,650 per fortnight when combining HEAS with your pension.
Interest Rate and Repayment Flexibility
The interest rate for HEAS is 3.95% per annum, and it compounds fortnightly. Here’s what you need to know about repayments:
- No Immediate Repayments: You are not required to make repayments while receiving the loan.
- Repayment Flexibility: Repayments can be made at any time, without any penalties.
- Repayment Triggers: The loan, including interest, is repaid when:
- You sell the property
- You move into long-term care
- Or through your estate after death
The no negative equity guarantee ensures that neither you nor your estate will owe more than the value of your home when sold.
What’s New in 2025?
While the Home Equity Access Scheme remains largely unchanged for 2025, there are two major updates:
- Cost-of-Living Adjustment: Starting March 2025, the Age Pension will increase to help seniors manage inflation and rising costs.
- $5,000 Centrelink Cash Boost: Eligible Australians will receive a one-time $5,000 payment to help ease financial stress. This payment is available even if you are already accessing HEAS.
Step-by-Step Guide to Apply for HEAS in 2025
Here is a simplified guide on how to apply for the Home Equity Access Scheme:
1. Check Your Eligibility
Ensure you meet all the eligibility requirements outlined above.
2. Understand the Costs
Use the HEAS calculator on the Services Australia website to calculate how much you may be eligible to receive.
3. Gather Required Documents
Prepare the necessary documents such as proof of identity, property ownership, and income details.
4. Seek Financial Advice
Consult a financial planner or speak with a Centrelink Financial Information Service officer for advice tailored to your situation.
5. Apply Online
Submit your application online through your myGov account linked to Centrelink.
Alternatively, you can apply in person at a Services Australia office.
Real-Life Example
Take Margaret, for example. At 73, she owns her home but only receives a part Age Pension of $500 per fortnight.
By applying for HEAS, Margaret now receives an additional $700 per fortnight, boosting her income and allowing her to live more comfortably without selling her home. She plans to repay the loan from her estate in the future.
HEAS Overview Table
| Feature | Details |
|---|---|
| Eligibility | Age Pension age or older, Australian property owner, meets residency criteria |
| Loan Amount | Up to 150% of the maximum pension rate depending on property value and age |
| Interest Rate | 3.95% per annum, compounding fortnightly |
| Payment Options | Fortnightly payments, lump sum (up to 50% of pension in 26 fortnights), or combination |
| Repayment | Voluntary anytime, or upon sale of property, death, or entry into aged care |
| Recent Updates | March 2025 Age Pension increase, $5,000 Centrelink Cash Boost |
| Application | Apply online via Services Australia, documents required: identity proof, property details |
Centrelink’s Home Equity Access Scheme (HEAS) provides a unique opportunity for older Australians to increase their income without the need to sell their homes. With the 2025 updates, including the Age Pension increase and the $5,000 Centrelink Cash Boost, the scheme becomes even more valuable for seniors looking for financial support.
Whether you opt for fortnightly payments, a lump sum, or a combination of both, HEAS offers flexibility, security, and peace of mind for your retirement years. If you meet the eligibility criteria, this scheme could be the solution you need to live comfortably and maintain your independence.
FAQs
What is the Home Equity Access Scheme (HEAS)?
The HEAS is a government initiative that allows seniors to access a non-taxable loan using the equity in their homes to supplement their income.
Who is eligible for the scheme?
Applicants must be of Age Pension age or older, own property in Australia, and meet residency requirements. You also must not be bankrupt or under a personal insolvency agreement.
What payment options are available under HEAS?
You can choose from fortnightly payments, a lump sum, or a combination of both options.
How much can I borrow through HEAS?
The total amount of HEAS and your pension payments cannot exceed 150% of the full Age Pension.