Home Loans for Pensioners

If your only income is the pension but you're keen to become a homeowner, we've got good news: although it is more difficult, Australian borrowers on pensions can get mortgages. 

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Lenders view pensioners as high-risk borrowers for home loans because they are typically older and on smaller incomes. But a lender may be willing to offer a home loan to a pensioner, depending on your individual circumstances.

How can I get a home loan on a pension?

Pensioners who want to apply for a home loan should start by considering the loan from their lender's perspective. What is the most important thing to a bank? Your ability to repay the loan. Therefore, you should consider what your income and financial position looks like, as it will form the basis of getting a home loan or not.

If your only source of income is the pension, then this might limit your options as the pension amount is lower than the income level most lenders require you earn, in order to repay a loan.

However, there are several ways a pensioner can apply for mortgage finance. The best option for you depends on your financial situation.

Apply for a standard home loan

If you have forms of income from other sources or you are only borrowing a small amount, you may be able to apply for a home loan like any other borrower. If this is your situation you might be able to get a competitive interest rate, so be sure to compare your options.

Apply with a specialist lender

There are lenders who specialise in providing finance solutions to borrowers in difficult or unique circumstances. There are even lenders who focus entirely on older borrowers. These types of lenders provide loans known as specialist or non-conforming loans.

Talk to a mortgage broker

Perhaps the best option for pensioners looking for a home loan is to get in touch with a mortgage broker. This is because mortgage brokers specialise in helping borrowers in unique circumstances and they have access to a wide panel of lenders.

A broker can help you look for loans and lenders that match your requirements. Their services are typically free to you because the lender you choose will pay them a commission.

What documents do pensioners need to supply for a home loan?

As a pensioner you will need to provide a few extra documents in addition to the standard documents in a mortgage application. Every lender has their own requirements but you'll generally need to provide the following:

  • Evidence of funds to complete the deposit.
  • Bank statements showing Centrelink benefits being paid into your bank account (i.e. some lenders require 6 months of recent bank statements).
  • Letter from Centrelink confirming the status and nature of your disability pension.

What about borrowers on disability pensions and veterans' pensions?

Disability pensions

Generally, lenders consider a disability pension to be a valid form of income, meaning they treat a home loan application for someone on a disability pension just like any other application.

Most lenders will review your application on a case-by-case basis. Your eligibility for a home loan will depend on the amount of income you receive and how much of this can be used to service a loan.

Other factors including your age, assets and debts will be assessed by a lender on an individual basis.

Veterans' pensions

Many lenders may accept a Veterans' Pension as a source of income for a home loan. This applies if you are receiving:

  • War Widow's or Widow's Pension
  • Service Pension
  • Veterans' Affairs Age Pension

Additionally, lenders may accept the Department of Veterans' Affairs Incapacity Pension as a source of income. In order to demonstrate your pension as a source of income for a home loan application, you'll need either a current bank statement showing your pension payment, or a current Department of Veterans' Affairs statement.

On Centrelink? You could still get a home loan

Other mortgage types for older borrowers

If you're a pensioner who already owns their own home you have some other finance options. Both reverse mortgages and line of credit loans allow you to borrow money against the equity in your home.

  • Reverse mortgages. A reverse mortgage allows you to borrow funds using equity from your home as security for the loan. A reverse mortgage can either be paid as a lump sum, a regular stream of income, a line of credit or a combination of these. No income is needed to qualify and for this reason, the interest rate tends to be higher. You must repay the sum of borrowed money when you sell your home, pass away or move into aged care.
  • Line of credit loans. A line of credit is a funding line that uses the equity in your home. It’s an approved amount that you can use a bit at a time or all at once. You loan is approved against a security and you can draw on this loan amount at any time. You only pay the interest on the amount that you use. For example, if you get a line of credit of $200,000 and only use $50,000, you only pay interest on the $50,000. These types of loans can be harder to get, and not all lenders offer them.

In the tables below you can compare various finance options, from normal home loans to reverse mortgages and lines of credit. If you're a pensioner and are looking for some expert guidance, contact a mortgage broker for personal advice.

Compare standard home loans

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

Nano Variable Home Loans P&IHome≥ 25% Deposit Refi Only

Nano Variable Home Loans
1.99%
1.99%
  • App: $0
  • Ongoing: $0 p.a.
$555
Switch to this competitive variable rate with zero fees. Requires a 25% deposit.

UBank UHomeLoan Fixed P&IHome 1Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
1.79%
2.18%
  • App: $0
  • Ongoing: $0 p.a.
$540
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees.

HSBC Fixed Rate Home Loan Package P&IHome 2Y Fixed≥ 20% Deposit

HSBC Fixed Rate Home Loan Package
1.88%
2.87%
  • App: $0
  • Ongoing: $390 p.a.
$547
$3,288 refinance cashback offer
Lock in a low fixed rate for 2 years and buy your home with a 20% deposit. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.

loans.com.au Smart Booster Discount Variable Home Loan P&IHome≥ 20% Deposit

loans.com.au Smart Booster Discount Variable Home Loan
1.85%
2.21%
  • App: $0
  • Ongoing: $0 p.a.
$545
Get a low discounted variable rate loan. Requires a 20% deposit. Get your loan processed fast and settle within 30 days.

Suncorp Home Package Plus Fixed P&IHome 2Y Fixed≥ 20% Deposit

Suncorp Home Package Plus Fixed
1.89%
2.85%
  • App: $0
  • Ongoing: $0 p.a.
$548
$3,000 refinance cash bonus
Lock in a low fixed rate for 2 years. Available with a 20% deposit. Eligible new borrowers can get the annual package fee reimbursed for the life of the loan. $3,000 refinance cash bonus for eligible borrowers. Other terms, conditions and eligibility criteria apply.

Athena Variable Home Loan P&IHome≥ 40% Deposit

Athena Variable Home  Loan
1.99%
1.99%
  • App: $0
  • Ongoing: $0 p.a.
$555
Owner occupiers with 40% deposits or equity can get this competitive variable rate loan. No upfront or ongoing fees.

Westpac Flexi First Option Home Loan P&IHome≥ 5% Deposit

Westpac Flexi First Option Home Loan
2.09%
2.52%
  • App: $0
  • Ongoing: $0 per month
$563
$3,000 refinance cashback
A flexible and competitive variable rate loan. Available to owner occupiers on principal and interest loans. $3,000 cashback for eligible refinancers. Apply by 30 November 2021. Terms and conditions apply.

IMB Fixed Rate Home Loan P&IHome 2Y Fixed≥ 5% Deposit

IMB Fixed Rate Home Loan
2.07%
2.90%
  • App: $449
  • Ongoing: $6 per month
$561
NSW and ACT customers only. Lock in a low fixed rate for two years. Available with a 5% deposit.

Well Home Loans Equity Plus P&IHome≥ 40% Deposit

Well Home Loans Equity Plus
1.87%
1.90%
  • App: $250
  • Ongoing: $0 p.a.
$546
Borrowers with 40% deposits or equity can get this low variable rate loan. 100% offset account included.

Community First Accelerator Package Fixed Home Loan P&IHome 3Y Fixed≥ 20% Deposit

Community First Accelerator Package Fixed Home Loan
1.79%
3.12%
  • App: $0
  • Ongoing: $395 p.a.
$540
Lock in this low fixed rate for 3 years and get a 100% offset account. Requires a 20% deposit.

ME Flexible Home Loan Fixed with Members Package P&IHome 2Y Fixed≥ 20% Deposit

ME Flexible Home Loan Fixed with Members Package
1.89%
3.17%
  • App: $0
  • Ongoing: $395 p.a.
$548
$3,000 cashback when refinancing a loan of $250,000 or more. Other conditions apply. Lock in a competitive rate for owner occupiers for two years. Comes with a 100% offset account.

Australian Unity Health, Wealth and Happiness Package Fixed Home Loan P&IHome≥ 30% Deposit

Australian Unity Health, Wealth and Happiness Package Fixed Home Loan
1.89%
2.66%
  • App: $0
  • Ongoing: $399 p.a.
$548
Lock in a competitive rate for 2 years and get package discounts. Requires a 30% deposit.

Bank of Melbourne Fixed Rate Home Loan with Advantage Package P&IHome 2Y Fixed≥ 20% Deposit

Bank of Melbourne Fixed Rate Home Loan with Advantage Package
1.84%
3.38%
  • App: $0
  • Ongoing: $395 p.a.
$544
$3,000 refinance cashback
Get a competitive home loan rate for two years. Requires at least a 20% deposit. Refinancers borrowing $250,000 or more can get a $3,000 cashback (Apply by 30 November 2021. Terms and conditions apply). Refinancers Only.

Macquarie Bank Basic Fixed Home Loan P&IHome 3Y Fixed≥ 30% Deposit

Macquarie Bank Basic Fixed Home Loan
2.09%
2.17%
  • App: $0
  • Ongoing: $0 p.a.
$563
Get a low interest rate and a mortgage with flexible, basic features. No application or ongoing fees. Requires a 30% deposit. Refinancers can switch with a convenient digital application.

Newcastle Permanent Building Society Premium Plus Package Fixed Rate P&IHome 3Y Fixed≥ 20% Deposit

Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.19%
3.61%
  • App: $0
  • Ongoing: $395 p.a.
$570
$2,000 cashback for eligible refinancers borrowing $250,000 or more.

Well Home Loans Balanced Fixed Home Loan P&IHome 1Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
1.84%
2.01%
  • App: $250
  • Ongoing: $0 p.a.
$544
Owner occupiers can get a sharp fixed rate for the first year, plus an offset account. Available with a 10% deposit.

UBank UHomeLoan Fixed P&IHome 3Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
1.85%
2.13%
  • App: $0
  • Ongoing: $0 p.a.
$545
A competitive fixed rate loan with no ongoing fees. Requires a 20% deposit.

loans.com.au Smart Booster Discount Variable Home Loan P&IHome≥ 20% Deposit

loans.com.au Smart Booster Discount Variable Home Loan
1.99%
2.47%
  • App: $0
  • Ongoing: $0 p.a.
$555
Home buyers can get a very low discounted variable rate for the first year. Requires a 20% deposit. Add an offset sub-account for an additional 0.10% on your interest rate. Get your loan processed fast and settle within 30 days.

Westpac Fixed Option Home Loan Premier Advantage Package P&IHome 2Y Fixed≥ 5% Deposit

Westpac Fixed Option Home Loan Premier Advantage Package
2.09%
3.50%
  • App: $0
  • Ongoing: $395 p.a.
$563
$3,000 refinance cashback
Lock in a low fixed rate for 2 years that allows you to make up to $30,000 in extra repayments and buy your home with a 5% deposit. $3,000 cashback for eligible refinancers. Apply by 30 November 2021. Terms and conditions apply.

Macquarie Bank Basic Home Loan P&IHome≥ 40% Deposit

Macquarie Bank Basic Home Loan
2.14%
2.14%
  • App: $0
  • Ongoing: $0 p.a.
$567
Apply for the Macquarie Bank Basic Home Loan - LVR ≤ 60% (Owner Occupier, P&I) and get a low variable interest rate, plus no application and ongoing fees. Requires a 40% deposit.
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Compare up to 4 providers

Compare mortgage brokers

Name Product Upfront consultation fee Variable rates from Comparison rates from Lenders on panel Apply Now
Finsure
$0
3.03%
3.04%
35
Finsure has a large panel of lenders and offers flexible mortgage solutions for borrowers.
Mortgage Choice
$0
3.03%
3.04%
20
Mortgage Choice's extensive broker network can help you find the right home loan.
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Compare up to 4 providers

Compare reverse mortgages

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

Heartland Standard Reverse Mortgage P&IHome≥ 55% Deposit

Heartland Standard Reverse Mortgage
5.60%
5.62%
  • App: $0
  • Ongoing: $0 p.a.
$863
A reverse mortgage for homeowners over 60 wishing to access up to 45% of their property's value. Repayments are not required until the end of the loan.

Household Capital Refinance Variable Home Loan P&IHome≥ 50% Deposit

Household Capital Refinance Variable Home Loan
4.95%
4.98%
  • App: $950
  • Ongoing: $0 p.a.
$802
Borrowers over 60 can refinance to this competitive, variable reverse mortgage.

Heartland Secondary Property Reverse Mortgage P&IInvestment≥ 66.25% Deposit

Heartland Secondary Property Reverse Mortgage
5.60%
5.62%
  • App: $0
  • Ongoing: $0 p.a.
$863
A reverse mortgage that lets you access the equity in your investment property. Repayments are not required until the end of the loan.

Household Capital Reverse Mortgage Variable Home Loan P&IHome≥ 50% Deposit

Household Capital Reverse Mortgage Variable Home Loan
4.95%
4.98%
  • App: $950
  • Ongoing: $0 p.a.
$802
A competitive reverse mortgage for borrowers aged 60 and over. Flexible repayment options.

Heartland Aged Care Option P&I≥ 50% Deposit

Heartland Aged Care Option
5.80%
5.91%
  • App: $0
  • Ongoing: $0 p.a.
$882
A reverse mortgage designed to help fund your aged care costs. Repayments are not required until the end of the loan.
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Compare up to 4 providers

Compare line of credit loans

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

Well Home Loans Equity Plus P&IHome≥ 40% Deposit

Well Home Loans Equity Plus
1.87%
1.90%
  • App: $250
  • Ongoing: $0 p.a.
$546
Borrowers with 40% deposits or equity can get this low variable rate loan. 100% offset account included.

Bank First Equity Line of Credit P&IIOInvestment≥ 20% Deposit

Bank First Equity Line of Credit
4.49%
  • App: $300
  • Ongoing: $300 p.a.
$761
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Compare up to 4 providers

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124 Responses

    Default Gravatar
    TraceySeptember 6, 2021

    I want to make an appointment to see a mortgage broker please

      Avatarfinder Customer Care
      SarahSeptember 9, 2021Staff

      Hi Tracey,

      You can set an appointment by calling the broker or visiting their website. You can visit our mortgage broker page (https://www.finder.com.au/mortgage-brokers) to find a list of brokers.

      Cheers,
      Sarah

    Default Gravatar
    JohnSeptember 5, 2021

    Do you know of any Morgage Brokers that are or have Disability Pensioner Morgage Loans expertise or previous experience with a positive outcome?

      Avatarfinder Customer Care
      SarahSeptember 8, 2021Staff

      Hi John,

      Most mortgage brokers can provide you with tailored advise that suits your situation. We don’t have a list that confirms a broker’s specialisation on borrowers receiving disability pension, but you can check out our mortgage broker finder page to find a broker who can help: https://www.finder.com.au/mortgage-brokers

      Note that generally, getting a loan when the disability pension is your only form of income can be difficult. There are some lenders who accept Centrelink payments as proof of your income to get a home loan, but if you receive a disability pension, you will often need to show proof of a second source of income, as the pension on its own is not enough to service a home loan.

      Your best bet is to contact a mortgage broker to find out which lenders may be able to help you. Their services are free, and they can do the legwork for you to help you find a lender.

      Cheers,
      Sarah

    Default Gravatar
    TerryJuly 24, 2019

    I’m looking for a lender. Duplex ,one side rented for 315.00/wk other owner occupied price $200.000 dep $ 20,000, borrower on centrelink

      Default Gravatar
      NikkiJuly 25, 2019

      Hi Terry,

      Thanks for getting in touch! Pensioners can still apply for regular home loans that aren’t specific home loans for pensioners but you should keep in mind you may not be successful if you don’t meet eligibility or income requirements.

      Below are the types of home loans you can apply for:

      Reverse mortgages
      Variable rate loans
      Fixed rate loans
      Line of credit loans

      You can find a list of lenders when you click the type of loan on the left sidebar of this page above. As a friendly reminder, carefully review the eligibility criteria of the loan before applying to increase your chances of approval. Read up on the terms and conditions and product disclosure statement and contact the bank should you need any clarifications about the policy.

      Hope this helps!

      Best,
      Nikki

    Default Gravatar
    JodieJuly 4, 2019

    As a single woman on a disability pension am I eligible and how much could I be eligible for to buy a house?

      Avatarfinder Customer Care
      JeniJuly 4, 2019Staff

      Hi Jodie,

      Thank you for getting in touch with Finder.

      Since you are receiving a disability pension, the amount you can be eligible for a loan to buy a house depends on your income. Your chosen lender will review whether the amount of income support you receive is sufficient for you to comfortably repay the loan. I suggest that you speak to a mortgage broker on this matter for further clarification and assistance.

      I hope this helps.

      Thank you and have a wonderful day!

      Cheers,
      Jeni

    Default Gravatar
    MichelleFebruary 18, 2019

    I’m on disability pension so is my flat mate we are wanting to buy a home as with the rent we pay now cld have brought us a beautiful home .
    So we are lookin for some one to loan one of us or the both of us home loan

      Default Gravatar
      NikkiFebruary 20, 2019

      Hi Michelle,

      Thanks for getting in touch!

      It’s helpful to know that we are not an approving body for home loans. The information above will pave the way for how to get started on that home loan application and make sure you check the eligibility requirements of a home loan. To help you find the lender that suits you, you can speak to a mortgage broker who can take your personal circumstance into account and offer you a range of borrowing options. Good luck!

      Best,
      Nikki

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