Reverse Mortgage and Age Pension Entitlements

October 19, 2026

Many older Australians value their age pension payments. For the majority of recipients, the use of a reverse mortgage will have no effect on current entitlements.

Each age pension recipient is assessed on both their assets and income to determine their pension payment.


Maximum assets for Full pension

From 20th September 2024, allowances and full age pensions reduce when your assets are more than the limit for your situation.

Your situation Homeowner Non-homeowner
Single $314,000 $566,000
A couple, combined $470,000 $722,000

Maximum assets for Part pensions

From 20th September 2024, part pensions cancel when your assets are more than the limit for your situation.

Your situation Homeowner Non-homeowner
Single $695,500 $945,500
A couple, combined 1,045,500 $1,297,500

With a Reverse Mortgage, up to $40,000 is exempt from the assets test for up to 90 days, so the money needs to be spent within this time limit to avoid it becoming an assessable asset. If $50,000 is used for home repairs/maintenance on the principle place of residence, (an exempt asset), the monies spent will not be included as an asset. If the $50,000 is to pay for a new car, the value of that car then becomes a non-deemed asset.


Advisers are required to have a discussion with potential borrowers about future needs and many discussions lead to having a Line of Credit structure into the loan facility to meet any future needs, if and when they may occur. From an age pension perspective, it is important to know that a Line of Credit is not regarded as an asset.


Assessable income on financial assets

The Government has amended deeming rates from 1st July 2024).

Situation

Deeming rate

Situation

Lower rate: 0.25% on the first $62,600 of your investment assets, plus
Upper rate: 2.25% on your investment assets over the amount of $103,800

If you are a member of a Couplewhere at least one of you gets a pension

Lower rate: 0.25% on the first $103,800 of your combined investment assets, plus
Upper rate: 2.25% on your investment assets over the amount of $62,600 Single OR $103,800 Couple

Centrelink is the ultimate source for determining age pension entitlements, but Paul will assist potential borrowers with basic information about their qualifications.

It is important to ensure age pension recipients regularly update their information with Centrelink. In the first 3 months of 2024, our advisers have met 3 clients whose details have not been updated to reflect their circumstances, and have missed out on between $16,000 and $30,000 over the past 3 years.

 

Are you eligible for the full age pension?

From 20th September 2024, the full age pension is $1144.40 p/f for a single and $862.60 each per couple.


We recommend recipients check their payments to reflect their current asset and income position.

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