What is the government Home Equity Access Scheme (HEAS)?

HEAS (formerly the Pension Loans Scheme) is a Services Australia government program allowing retirees of Age Pension age to borrow against home equity at low government interest rates.

How do HEAS interest rates compare to commercial reverse mortgages?

HEAS charges a lower government interest rate (currently ~3.95% p.a.) compared to commercial reverse mortgages which typically charge 7.50% to 8.50% p.a.

Does borrowing money on a reverse mortgage affect my Centrelink Age Pension?

The loan amount itself is not assessable income, but lump sum cash drawdowns stored in bank accounts are subject to Centrelink asset and income deeding tests.

Can I get a lump sum drawdown from the government HEAS scheme?

Yes. HEAS allows up to two lump sum advances per 12-month period (up to 50% of the maximum annual Age Pension rate), in addition to fortnightly top-ups.

Is my home protected under No Negative Equity Guarantee with HEAS?

Yes. Both government HEAS loans and commercial reverse mortgages include statutory No Negative Equity Guarantee protections.

Mortgage & Property13 min read•Updated: 8 August 2026

Reverse Mortgage vs Government Home Equity Access Scheme (HEAS): Pension & Equity Comparison (2026–2027)

Detailed comparison for Australian retirees between commercial reverse mortgages and the Services Australia Home Equity Access Scheme (HEAS), interest rates, Centrelink pension rules, and NNEG protections.

Calcivo Retirement Research

Senior Equity & Pension Advisers

ATO 2026-2027 Verified

Reverse Mortgage vs Government Home Equity Access Scheme (HEAS): Pension & Equity Comparison (2026–2027)

Key Financial Takeaways

✓The Home Equity Access Scheme (HEAS) is a government-backed equity release scheme administered by Services Australia for Age Pension age retirees.
✓HEAS interest rates (typically ~3.95% p.a.) are substantially lower than commercial reverse mortgage rates (~7.50% - 8.50% p.a.).
✓HEAS allows fort-nightly income top-ups up to 150% of the maximum Age Pension, while commercial reverse mortgages offer larger lump sum drawdowns.
✓Both HEAS and commercial reverse mortgages taken out after 18 Sept 2012 include statutory No Negative Equity Guarantee (NNEG) protections.
✓Lump sum drawdowns held in bank accounts can affect Centrelink asset and income tests for the Age Pension.

On This Page

For Australian retirees seeking to unlock home equity to fund retirement, two primary options exist: Commercial Reverse Mortgages offered by non-bank lenders, and the Home Equity Access Scheme (HEAS) offered directly by the Australian Federal Government through Services Australia (Centrelink).

Understanding the differences in interest rates, payout structures, Centrelink Age Pension impacts, and statutory safeguards is vital for senior financial planning.

1. What Is the Home Equity Access Scheme (HEAS)?

The Home Equity Access Scheme (HEAS)—formerly known as the Pension Loans Scheme (PLS)—is a government-backed voluntary equity release program. It allows Australian homeowners who have reached Age Pension age (67+) to receive non-taxable fortnightly payments or lump sum advances by leveraging their Australian real estate.

2. Key Differences: Commercial Reverse Mortgage vs Government HEAS

Feature / Metric	Commercial Reverse Mortgage	Government HEAS (Services Australia)
Provider	Commercial Non-Bank Lenders	Services Australia / Department of Veterans' Affairs
Eligibility Age	Age 60+	Age Pension Age (Age 67+)
Typical Interest Rate	7.50% – 8.50% p.a.	3.95% p.a. (Government Concessional Rate)
Payout Flexibility	Large initial lump sums + line of credit	Fortnightly top-ups (up to 150% of pension) + capped lump sums
No Negative Equity Guarantee	Statutory (Sec 88A NCCP Act)	Statutory Protection Included
Upfront Setup Fees	Valuation & Lender Establishment Fees	Minimal administrative costs

3. Centrelink Age Pension Asset & Income Test Impact

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Loan Drawdowns are NOT Taxable Income: Money borrowed from a reverse mortgage or HEAS is capital debt, not assessable income.
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Bank Balance Asset Testing: If you draw down $100,000 cash and keep it in your savings account, Centrelink counts those funds under the Deeming Rules for the income test and under the Assets Test, which may reduce your pension payment. Spending the cash on home renovations or living expenses removes it from asset testing.