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Management and Maintenance of Home Equity Access Scheme Loans

Last amended 
1 July 2022
Decrease in loan rate - assets tested pensioners

The amount owed by a person under the Home Equity Access Scheme is deducted from the value of the assets held as security against the loan. If the assets held as security are assessable under the assets test, the person's pension entitlement under the assets test increases as the amount is deducted from the value of those assets. As the person's pension entitlement increases, their fortnightly loan rate may decrease depending on how they have set their Home Equity Access Scheme rate.

Any exempt assets used for security do not affect the loan rate in this way, as the reduction in the value of an exempt asset has no impact on the assets test.    

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Members of a couple

Members of a couple may nominate different loan rates or only one member of a couple may apply for Home Equity Access scheme. These loans are not joint loans but individual loans to each member of a couple and are paid off separately.

Interest charged on the Home Equity Access Scheme loan




Interest under Home Equity Access Scheme is charged at a rate set by the Minister for Social Services by notice in the Australian Government Gazette. 

. The rate is currently 3.95% per annum, compounding fortnightly, and is reviewed periodically.

Interest is calculated on the outstanding balance, owing each fortnight, of:

  • combined loan payments and accrued interest, less
  • any repayments made by the pensioner.

Interest will accrue on the outstanding balance until the loan has been repaid in full by the participant or their estate. Any legal costs associated with establishment of the loan do not attract interest, and will just be added to the outstanding loan amount to be repaid.

Date of effectInterest rate
1 January 2022 to present3.95%
1 January 2020 to 31 December 20214.50%
25 December 1997 to 31 December 20195.25%
20 March 1997 to 24 December 19976.25%
10 July 1996 to 19 March 19977.90%
1985 to 10 July 199610%
Deduction of repayments from balance

If a loan repayment is made, that repayment is deducted from the balance of the loan on the pension payday immediately prior to the date the repayment is made. If repayment is made on a payday, that repayment is deducted from the total loan balance before interest is calculated for the payday on which the repayment was made.



An exempt asset is one that is disregarded when calculating the value of a person's assets under the assets test.  Examples of exempt assets include:

For a full legislative definition see section 52 of the VEA.