Reverse mortgages
Who can get a reverse mortgage
Age is the first filter, and it is the age of the youngest borrower that counts. Meeting the age guide does not mean a lender will offer a loan. Property, location and the lender's own criteria all sit on top.
Age
The usual minimum is 60, and it is the age of the youngest borrower that counts. A borrower aged 55 to 59 may be considered on an owner-occupied home when their partner is 60 or over. That younger age is not available on every loan, so ask what applies to the one in front of you.
How much you can borrow is also tied to that youngest age. A common published guide is the age minus 40, as a percentage of the home's value, about 20% at 60 and about 50% at 90 or over. Some lenders start lower, nearer 10% at 60. The calculator on this site uses the age-minus-40 guide and labels it as a guide only.
The home
The property is usually your main home, of ordinary construction, and in reasonable repair. Lenders set a minimum value and can decline some locations, apartments, or lifestyle blocks. A holiday home or rental may be considered under a separate set of rules, often at a lower percentage.
You need to own it, alone or with others who all agree. A small existing mortgage can often be cleared from the new loan, because the reverse mortgage has to be the only mortgage. A large mortgage may not fit.
What a lender still checks
A published age and percentage is not an entitlement, because the lender looks at the valuation, the property and its own responsible lending checks. You must get independent legal advice from your own lawyer before you sign, and the decision to apply, and to sign, is yours as the homeowner.
The decision is yours as the homeowner. Family may have a view, and it is worth talking it through, but the choice is yours.
General information only, not advice. We're a referral service and may receive a commission. If a reverse mortgage settles, the lender may pay us a referral fee.
Questions
- Can I apply at 55?
- Only in some cases. One approach is to consider a borrower aged 55 to 59 on an owner-occupied home when their partner is 60 or over. Other lenders require everyone living in the home under the loan to be at least 60. It is not a general rule for every 55 year old.
- Does household income matter?
- There are no regular repayments to cover from income, which is why income is not the main test. You still need to meet rates, insurance and maintenance. A lender can ask about those costs.
- Can a trust apply?
- Sometimes, if the people living in the home meet the age rules and everyone who has to sign agrees. The lender's trust criteria are its own. Ask your lawyer to read how the trust and the mortgage sit together.