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3.6.5 Widows/Widowers with Own Entitlement
Widows/widowers who are eligible on the basis of their own service as well as their spouse's or de facto partner's service are able to receive the benefits to which they would have been entitled had their spouses or de facto partners not predeceased them. ie they are allowed to "pool" the entitlements. Two Certificates of Entitlement (each for a maximum of up to $25000 where neither entitlement has been used before, or the relevant limit balances where loans have been partly used) may be issued to a widow/widower where that person is both an eligible person in her/his own right and the widow/widower of an eligible person, provided that the widow/widower has not legally remarried at the time of determining eligibility on the widow/widower status. Two separate but cross referenced Certificates of Entitlement should be issued if assistance is approved.
It is important that the widow/widower is counselled fully on her/his entitlements because the chance to obtain dual assistance is a once-only opportunity. If she/he decides to take only one advance (ie. an advance is obtained on the person's own eligibility either as an Australian soldier or as a widow/widower), she/he would be unable to obtain the other advance at a later date. This is because she/he will become a borrower otherwise than merely because she/he was a joint borrower with her/his spouse or de facto partner and therefore her/his circumstances would no longer satisfy the criteria for an initial advance as defined in Section 4 of the Act. However, it is equally important to note that this rule does not apply in cases where the widow is eligible as a WWII ex-servicewoman as provided by subsection 4(2AA), nor to a 'veteran widower' of such a person, because of the special provisions contained in subsections 4(2AB) and 4(2AC) in relation to further and initial advances.
Where a married couple has pooled their entitlements and one of them dies, the survivor may receive two further advances. Both further advances would be for the limits of the loans at the time they were discharged. Again this is a once-only opportunity.
Eligibility GO 12.2.1 outlines three categories of widows/widowers in circumstances where their spouses or de facto partners have received assistance. The three categories are:-
(i) where an advance, taken out as joint tenants, was discharged prior to the death of the person on whose service the advance was granted;
(ii)where an advance, taken out as joint tenants, was current when the person on whose service the advance was granted died. The widow/widower would then become the sole borrower through survivorship without using her/his own entitlement; and
(iii) where an advance was taken out by the now deceased person in his/her sole name.
A widow/widower in either of the first two categories has previously been a purchaser or borrower merely because she/he was a joint purchaser or borrower with her/his spouse or de facto partner and became such a purchaser or borrower on the basis that her/his spouse or de facto partner was an eligible person. Therefore, such persons are included among those able to receive initial advances as defined in ss4(1).
For category (iii) widows/widowers, a property which is subject to a DSH loan is allowed to remain in the name of the estate. Under these circumstances, a subsidy would continue to be paid without affecting the widow's/widower's entitlement. It is not necessary to transfer the property to a surviving spouse or de facto partner for a subsidy to continue. If the property and the loan are not transferred, no entitlement is lost. A widow/widower in category (iii) would become a borrower in her/his own right if she/he elected to transfer the property to her/his name as beneficiary and would therefore no longer be entitled to receive an initial advance. As mentioned above, this rule does not apply to WWII ex-servicewomen covered by subsection 4(2AA), nor to a 'veteran widower' of such a person.
If the property and the loan is transferred, only the limit of the late spouse's or de facto partner's loan is then available for portability purposes. There is no entitlement to another initial advance. Where a client seeks a further advance, the normal provisions relating to further advances are to be applied. Care should be exercised to establish whether the widow/widower has remarried since the original Certificate of Entitlement was issued- remarriage voids the status of a widow/widower. Where a widow/widower has remarried, only a subsidised loan granted in respect of that person's own service may be taken into account for determining the amount of the further advance.