Home loans for pensioners
Home Loans for Pensioners and Retirees
Being retired or on a pension doesn’t automatically rule out a home loan. What lenders look at is whether you can afford the repayments and how the loan will be repaid. Some lenders count pension income that others won’t. We compare options from a panel of 40+ lenders.
What lenders look at
Income, term and how it gets repaid.
Lending criteria, fees and charges apply.
Pension income
Some lenders may count long-term pensions, such as the Age Pension and carer and disability pensions, as income. Some count them in full and others only alongside other income. Rent from an investment property, super income streams and part-time work can count too.
The loan term
A shorter term means higher repayments but less interest. A longer term lowers repayments, but if it runs past when you expect to stop working, the lender will ask how you plan to repay it.
Your exit strategy
An exit strategy is your plan to clear the loan, such as downsizing, selling another property, or using super or savings. A clear, realistic plan helps a lender see the loan suits you.
Your equity
Some retirees have significant equity in their home. A smaller loan against a valuable property can help, though it doesn’t replace the need to show you can afford the repayments. Check your position with the equity calculator.
Common reasons
Why retirees borrow.
Refinancing a loan you already have
If you still have a home loan, a loan review checks whether another lender offers a better deal. It’s a new application, so we check lender policy for your income first.
Downsizing
Buying before you sell may need a bridging loan for a short time. Those loans have their own costs and risks.
Renovating to stay put
Some people borrow to make their home easier to live in. Lenders assess it like any other loan. See our guide to refinancing to renovate.
Helping family
Using your home to help children buy, such as with a family guarantee, puts your home at risk if they can’t repay. Get your own legal advice before you sign.
Check the pension side
Borrowing, selling or moving money can affect your pension. Services Australia’s Financial Information Service can explain how, before you decide.
Questions
Common questions, straight answers.
Can I get a home loan on the Age Pension?
Possibly. Some lenders may count pension income, alone or with other income such as rent or super drawdowns, while others count only part of it or treat it as supplementary. Whether the loan is approved depends on the whole application. Approval is always up to the lender.
Is there an age limit for a home loan?
Lenders set their own policies, and they must check the loan suits you. If the term runs past when you expect to retire or stop working, expect to be asked how you plan to repay it.
What is an exit strategy?
It’s your plan for repaying the loan if it runs past retirement, such as downsizing, selling an investment property, or using super or savings. Lenders ask for it so the loan doesn’t rely on income you won’t have.
Which pensions do lenders accept?
It depends on the lender. Some may consider long-term pensions such as the Age Pension and carer and disability pensions. Policies differ, so we check how each lender treats your income.
Can I refinance as a retiree?
Possibly. Refinancing is a new application, so the lender assesses your current income and the loan term again. If your current loan works and the saving is small, staying put may suit you better.
Should I get advice before borrowing in retirement?
A loan can affect your pension and your plans for retirement. It’s worth talking to a financial adviser or Services Australia’s Financial Information Service about the pension side before you borrow.
Talk through a loan on pension or retirement income.
No obligation. No pressure. Just honest answers.
We don’t charge you for our service. Lenders pay us a commission if you go ahead with a loan.