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We at Household Capital would love to help you live well at home by offering retirement income solutions.
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What is a Household Loan?
A Household Loan is our innovative approach to borrowing against home equity for responsible, long-term, retirement funding. It is a type of reverse mortgage.
A reverse mortgage allows you to borrow money using the equity in your home as security. Interest is charged like any other loan, but you don’t need to make repayments while you live in your home. The loan must be repaid in full when you sell or leave your home or, in most cases, if you move into residential aged care.
Please see the Reverse Mortgage Information Statement for more information.
To find out more about reverse mortgages, including a reverse mortgage calculator to help you work out how much equity you may have in the future, visit the Australian Securities and Investments Commission’s free consumer website at www.moneysmart.gov.au.
What protections does a Household Loan provide?
A Household Loan is a type of reverse mortgage, so you benefit from key structural and legislative protections.Ownership
- You remain the owner of your home (and benefit from any increase in property value)
- You can stay in your home for as long as you want to.
- There is no requirement for you to make periodic loan repayments (although you can do so at any time without penalty). The loan becomes repayable when you leave your home.
- You cannot end up owing us more than your home is worth.
Watch this short video that describes the consumer protections that apply to our Household Loan.
What is the interest rate?
The interest rate on a Household Loan is a variable rate of 4.95% per annum, which is Australia’s lowest rate for a reverse mortgage or equity release product.
*The Comparison Rate based on a loan of $150,000 for 25 years is 5.01% per annum effective 09 Nov 2020 (5.21% prior date). Fees and charges may be payable. Note: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.
Will my Age Pension be affected?
The Age Pension is an important source of income for many retired Australians. We can work with you to understand how a Household Loan can be used to preserve your pension entitlements and always recommend you speak to Centrelink to ensure your entitlements aren't affected.