Last amended: 25 September 2013
Subsection 21A(b) requires that the person must be either the owner of the dwelling-house, or have a right of residence in a retirement village / granny flat. A person in rental accommodation cannot access a Home Support Loan.
To paraphrase the Act, the purpose of the Home Support Loan is related to the dwelling-house or right of residence that will assist the person to remain independently housed.
The usual purposes for which the Home Support Loan would be considered include
However, it is recognised that there may be many other purposes for which assistance will be sought.
It is important for delegates to note that the actual purpose of the Home Support Loan is to assist a person to remain independently housed. The secondary qualification is that the purpose is related to the dwelling-hose. The word "related" in its usual sense means associated, connected or allied by nature, origin, kinship etc.
A purpose can be related to a dwelling-house directly. This means any purpose directly related to the house, outbuildings, appurtenances, fences, utility services etc. However, a purpose may relate to a dwelling-house indirectly, due to its location or features as they impact on the ability of the person to remain housed there. As mentioned, we cannot assist with alternative accommodation, but we can consider a Home Support Loan where the purpose meets the wording and beneficial intent of the legislation.
Delegates should therefore carefully consider the purpose of assistance as presented by applicants, and seek guidance from senior staff where a proposed purpose is novel, but deserves consideration given the circumstances of the applicant. Where it is considered that the purpose for which a Home Support Loan is sought fails to have any direct or indirect link to the dwelling-house, delegates should ensure that the Statement of Reasons provides clear information to that effect.
Last amended: 25 September 2013
Some purposes have been specifically excluded, being to build a home, buy a home, buy land and build a home, obtain a right of residence, complete a partially built home or right of residence, or to discharge a mortgage over the home or right of residence (provision of a granny flat is related to the enlargement of a home).
Last amended: 25 September 2013
Where an applicant has an entitlement to an initial, additional or further advance, that entitlement must be considered first. If such a certificate cannot be issued (eg, because the applicant or spouse own another home), then a Home Support Loan can be considered.
If a certificate for an initial, further or additional advance is issued, it must be presented to the bank. An applicant cannot hold on to a certificate that has been issued as an initial, further or additional advance, and receive a Home Support Loan certificate. Subsection 21A(d) prevents this from happening. If the bank declines to make an initial, further or additional advance available, then that entitlement can be disregarded and a Home Support Loan certificate can be considered.
If the applicant already has outstanding subsidised loan balances and/or entitlement/s (excluding Widow/Widower/Essential Repairs Advances) that exceed $10,000, then a Home Support Loan cannot be approved. Due to the operation of subsection 21A(d), any existing entitlements are included in the $10,000 maximum, unless a Certificate of Entitlement cannot be issued, or the bank has refused such a loan.
It is not intended to penalise any applicant who has a relatively small further or additional advance entitlement. Given the fees and charges associated with establishing such loans, it would be uneconomic for the applicant to proceed, and unreasonable of us to insist. Where an Entitlement amount is below $3,000, or in cases where the remaining term is too marginal (eg under 2 years), then any such entitlement should be disregarded from the $10,000 calculation.
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