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Local Knowledge Finance
CPA and Registered Tax Agent · Credit Representative

What is a reverse mortgage?

A reverse mortgage lets older homeowners borrow against the equity in their home without selling it. Regular repayments are usually not required: the loan is repaid when you sell, move into care or pass away. Interest compounds over time, so the balance grows and reduces the equity left for you or your family.

Ask us about your borrowing limits Home equity in retirement articles

We arrange credit only; we don’t give financial, super or Centrelink advice; speak to a licensed financial adviser and Services Australia. The Government’s Home Equity Access Scheme is an alternative some homeowners consider. We mention it for information only and do not advise on whether it suits you.

Who it suits

  • Older homeowners who want to stay in their home and need extra income or a lump sum.
  • People with substantial equity and little or no existing mortgage.
  • Homeowners who have discussed the effect on their estate with family and are comfortable with it.
  • People who have compared the Home Equity Access Scheme, downsizing and other options first.

Documents lenders ask for

  • Identification for every borrower on the title.
  • Proof of ownership and details of any existing loan on the home.
  • Details of your income, including any pension, and your living costs.
  • Evidence of independent legal advice, which lenders usually require before you sign.
  • A property valuation, arranged through the lender.

Trade-offs and risks

  • Interest compounds, so the debt can grow faster than many people expect and use up a large share of your equity.
  • Less equity may be left for your estate, for aged care costs or for a later move.
  • A lump sum or regular payments may affect your Age Pension or other Centrelink payments.
  • Fees, the lender’s conditions and rules about who can live in the home all apply. Check what happens if a partner who is not a borrower lives with you.
  • Australian reverse mortgages include statutory negative equity protection, so you can’t owe more than the home is worth, as long as you meet the loan conditions.

How we're paid

  • Lenders usually pay us a commission when a loan settles, and some also pay an ongoing trail commission while the loan stays open.
  • We tell you what we expect to receive, and from whom, in our credit quote and credit proposal before you apply.
  • If a fee from you applies to your situation, it is set out in writing before you go ahead. There is no obligation to proceed.
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Related guides

Official information

Common questions

Reverse mortgages FAQs

Regular repayments are usually not required. The loan is repaid when you sell, move into care or pass away. Interest compounds in the meantime, so the balance grows. Many lenders let you make voluntary repayments if you want to.
You can usually stay as long as you keep to the loan conditions, such as living in the home, insuring it and keeping it in reasonable repair. Breaching those conditions can lead the lender to ask for repayment, so read them carefully with your lawyer.
Lenders set borrowing limits mainly by the age of the youngest borrower and the value of the home. We do not publish figures on this page. Ask us about your borrowing limits and we will explain them for your situation.
A reverse mortgage comes from a private lender. The Home Equity Access Scheme is a Government loan run by Services Australia for people of Age Pension age. Both are repaid from the home later. Services Australia can explain whether the scheme applies to you.

General information only. It does not take your objectives, financial situation or needs into account and is not financial product, tax or legal advice. Lending criteria, fees and charges apply. Super, Centrelink and aged-care fee advice is referred to a licensed financial adviser. Ding Financial Pty Ltd t/a Local Knowledge Finance is a Corporate Authorised Credit Representative 517980 of Global Mutual Funds Pty Ltd (ACL 222640).

Ask us about your borrowing limits

Call us on 02 8338 8900 to talk through how a reverse mortgage works for your home. Family are welcome to join the conversation.

Ask us about your borrowing limitsContact us