Key Takeaways
- Age alone does not stop you from borrowing after 60; lenders focus on whether your retirement income and repayment plan hold up, not how old you are.
- Options range from standard and refinance loans to reverse mortgages, the Home Equity Access Scheme, investment and bridging finance, each suiting a different goal and risk profile.
- A credible, documented exit strategy, such as downsizing, selling an investment property, or using some superannuation is often the deciding factor in approval.
- Because lender policies on maximum age, income types, and loan terms vary widely, comparing lenders or using a broker can be the difference between approval and decline.
For many Australians, the years approaching and following 60 are when property and lending decisions carry the most weight. Home equity is often substantial, but income usually becomes harder to predict as work winds down and retirement income takes over. At the same time, interest rates, living costs, and the gap between superannuation balances and actual retirement spending mean more people are reaching their 60s still carrying a mortgage, or wanting to use the wealth tied up in their home.
This creates a real decision, not a simple one. Can you still borrow after 60? Should you refinance, downsize, release equity, or leave your home untouched? Each path has different consequences for your cash flow, your estate, and your eligibility for the Age Pension. The right answer depends on your income, your age, the property itself, and what you actually want the money to do.
This article explains how lenders assess older borrowers, the main loan options available, the trade-offs of each, and the practical steps to take before applying. The goal is to help you understand the real lending logic behind these decisions, so you can choose with confidence rather than guesswork.
Can you get a home loan after 60 in Australia?
Yes. Age on its own is not a barrier to borrowing in Australia, and lenders are not permitted to refuse a loan purely because of how old you are. What changes after 60 is the way your application is assessed, because lenders must be satisfied you can repay the loan without ending up in hardship.
Under the National Consumer Credit Protection Act 2009 (NCCP), lenders have responsible lending obligations. They must verify your financial situation and confirm the loan is not unsuitable for you. For an older borrower, this means looking closely at how the loan will be repaid once you stop working, since the loan term may extend well into your retirement years. This is the central question that shapes everything else in the application.
In practice, plenty of borrowers over 60 are approved every year. They refinance, buy new homes, purchase investment properties, downsize, and release equity. What separates a smooth approval from a declined application is usually the strength of the income picture and the credibility of the repayment plan, not the borrower’s age.
Why is borrowing assessed differently later in life
The core reason borrowing changes after 60 is the loan term. A standard mortgage runs for up to 30 years. If you take a 30-year loan at 62, you would be 92 when it is due to be repaid, far beyond typical working life. Lenders need to understand how repayments will be sustained once employment income stops, and this single factor drives most of the differences you will encounter.
Several flow-on effects come from this:
- Loan terms are often shortened so the loan finishes around or before an expected retirement age, which increases the monthly repayment.
- Borrowing capacity tends to fall, because higher repayments over a shorter term consume more of your assessable income.
- An exit strategy becomes a formal requirement, meaning you must show a realistic way to repay or refinance the debt in retirement given your income may reduce
- Income is examined more carefully because pension, superannuation, and investment income are treated differently from a regular salary.
None of this makes lending impossible. It simply means the application needs to be structured thoughtfully, with the income and the repayment plan working together.
Main mortgage options for borrowers over 60
There is no single product for older borrowers. The right choice depends on whether you want to buy, refinance, free up cash flow, or draw on the equity in your home. A Loanworx Group broker is well versed in the various offering the marketplace. The options below range from standard mortgages to specialist equity release, and each suits a different situation.
Standard owner-occupier loan
This is the same loan a younger buyer would use, applied to a home you live in. It remains available after 60 if you can demonstrate genuine repayment capacity. If you are still working, ongoing employment income makes approval straightforward. If you are retired or semi-retired, the lender will rely on your retirement income and will expect a clear exit strategy, often a shorter term to suit.
Refinancing an existing mortgage
Refinancing means replacing your current loan with a new one, usually to secure a lower rate, change the structure, or access equity. For older borrowers, refinancing can reduce repayments and improve cash flow, but the new lender will reassess your full position. If your income has dropped since the original loan was taken out, your borrowing capacity may now be lower, so it is worth confirming serviceability before committing.
Investment loans
Buying an investment property after 60 is possible, particularly where rental income and existing assets support the application. Lenders will shade the rental income, typically counting around 80% of it to allow for vacancies and costs. The benefit is that the property can form part of your retirement income and your exit strategy, since it can later be sold to clear the debt.
Line of credit
A line of credit is less popular due to the extra cost, but lets you draw funds up to an approved limit against your property, paying interest only on what you use. It offers flexibility for renovations, medical costs or irregular expenses. The trade-off is discipline: because repayments are flexible, the balance can creep up over time if it is not managed carefully, which matters more when future income is fixed.
Reverse mortgage
A reverse mortgage allows homeowners, usually aged 60 and over, to borrow against their home with no required regular repayments. The interest is added to the loan balance and compounds over time, and the debt is repaid when the home is sold, you move into aged care, or you pass away. All reverse mortgages taken since 2012 carry a “no negative equity guarantee”, meaning you can never owe more than the home is worth.
The appeal is access to cash without selling or moving. The cost is that compounding interest can erode your equity significantly over a long period, which reduces what is left for your estate and may affect future options such as funding aged care. This is a tool that suits some retirees well and others poorly, so the long-term projection matters more than the headline.
Home Equity Access Scheme
The Home Equity Access Scheme (HEAS) is a government-backed option run through Services Australia. It lets eligible older Australians, including self-funded retirees and those on the Age Pension, receive a voluntary loan as a fortnightly payment, a lump sum, or both, secured against Australian property. The interest rate is set by the government and has historically been lower than commercial reverse mortgage rates, and it also carries a no negative equity guarantee.
HEAS suits people who want to supplement retirement income steadily rather than take a large amount at once. Because it is administered by the government and the amount you can draw is capped, it is generally more conservative than a commercial reverse mortgage, though less flexible for large one-off needs.
Bridging and downsizing finance
Bridging finance covers the gap when you buy a new home before selling your existing one. For downsizers, this avoids the stress of trying to settle both transactions on the same day. The loan is short-term and is repaid once the original property sells. The main risk is the sale taking longer or selling for less than expected, so a realistic sale estimate and a buffer are important.
How lenders assess borrowers over 60
Understanding the assessment process is the most useful thing an older borrower can do, because it shows exactly where an application is strengthened or weakened. A Loanworx Group broker will work with you and understands how lenders work through income, expenses, term, security, and provide a repayment plan, as each element influences the others.
Income assessment
Lenders look at how reliable and ongoing your income is, and they treat each type differently. Employment income from continuing work is the strongest. Superannuation income streams, account-based pensions, and annuities can be accepted, often where they are shown to continue for the loan term. Rental income and share dividends are usually shaded to allow for variability. The Age Pension is assessable income with some lenders, though many will not lend on pension income alone without other support, because it is modest and is intended for living costs.
This is also where income shading matters. Variable earnings such as overtime, bonuses and commissions are commonly counted at a reduced rate, often around 80%, because they are not guaranteed. For a borrower still working in their early 60s, understanding which parts of your income are treated as reliable can change your borrowing capacity considerably.
Living expenses
Lenders assess your declared living expenses against benchmark figures and your actual spending. In retirement, some costs fall, but others, such as health and insurance, can rise. A Loanworx Group broker will calculate a realistic, well-documented expense figure helps your application because understated expenses are a common reason for additional questions or delays.
Loan term and maximum age
Most lenders set an expected maximum age by the time the loan should ideally be repaid, frequently in the range of 70 to 75 for loans serviced from employed or self employed income. This often means a shorter term than the standard 30 years, which lifts the repayment, unless an alternative exit strategy is available. A shorter term is not a problem in itself, but it must still fit comfortably within your income, which is why term and serviceability are assessed together.
Loan-to-value ratio
The loan-to-value ratio (LVR) is the size of the loan compared with the value of the property. Borrowing above 80% of the property value usually triggers Lenders Mortgage Insurance (LMI), an extra cost that protects the lender. Older borrowers often have lower LVRs because they hold more equity, which strengthens the application and can avoid LMI altogether.
Credit history
Your credit report shows your repayment track record and existing commitments. A clean history reassures the lender, while missed payments or high existing debts can reduce your capacity. Reducing or closing unused credit cards before applying can improve your position, since available limits are counted as potential debt even if unused.
Exit strategy
For older borrowers, the exit strategy is often the deciding factor. It is your documented plan for repaying the loan once employment income stops, and the lender must consider it reasonable. A strong exit strategy is specific and supported by evidence rather than a vague intention.
Acceptable exit strategies commonly include:
- Downsizing to a smaller home and using the surplus to repay the loan.
- Selling an investment property to clear the debt.
- Drawing a superannuation lump sum at retirement.
- Maturing investments, such as a term deposit or shares.
- A spouse’s continuing income where one partner keeps working.
- An expected inheritance, though this is treated cautiously because it is uncertain.
Examples of suitable loan structures
The following scenarios show how these principles come together in practice. They are illustrative, and your own outcome will depend on your full circumstances, but they show the logic lenders apply.
A retired couple in their mid-60s wants to refinance a small remaining balance to a lower rate. They have substantial equity and a steady account-based pension. With a low LVR and a modest loan over a shorter term, serviceability is comfortable, and the exit strategy is simply downsizing in the future. This is typically a clean approval.
A 62-year-old who is still working full-time wants to buy a new owner-occupier home. Employment income supports a loan over a term that finishes around age 70, and the planned sale of the current home provides both the deposit and a clear exit. The shorter term lifts the repayment, but the high income absorbs it.
A self-funded retiree wants regular extra cash flow without selling the family home. Rather than a commercial loan they cannot easily service, the HEAS provides a steady fortnightly amount at a government-set rate, preserving most of their equity while topping up income.
An investor over 60 wants to add a rental property. Existing rental income, share dividends, and remaining super support the application once income is shaded, and the new property itself forms part of the exit strategy because it can be sold to clear the debt later.
Because lending policies for borrowers over 60 can vary significantly between banks, the same application may be assessed very differently depending on the lender. If you’re unsure how your retirement income, superannuation, Age Pension, or planned exit strategy will be viewed, seeking mortgage advice from a Loanworx Group broker can help you understand which loan options may be available before you apply. This can be particularly useful if you’re refinancing, purchasing a new home, accessing equity, or trying to structure a loan around upcoming retirement plans.
Risks and mistakes to avoid
Borrowing later in life is reasonable, but the consequences of getting it wrong are larger because there is less time to recover. Being aware of the common pitfalls helps you avoid them before they affect your retirement.
- Underestimating compounding on a reverse mortgage. Over 10 to 15 years, a modest loan can grow substantially, leaving far less equity than expected.
- Relying on an inheritance or an uncertain future event as the only exit strategy, which lenders treat with caution, and which can leave you exposed.
- Taking the longest possible term to lower repayments, then carrying debt well into retirement when income is lowest.
- Ignoring the effect of equity release on Age Pension eligibility and aged care affordability, both of which can be affected by how and where money is held.
- Failing to involve family or consider the estate impact, particularly with equity release products that reduce what is passed on.
None of these means a particular product is wrong for you. They simply need to be understood and planned for, ideally with financial advice alongside lending advice.
Costs to budget for
Every option carries costs beyond the interest rate, and these matter more when you are managing a fixed retirement budget. Knowing them in advance prevents surprises at settlement and helps you compare options fairly.
- Application or establishment fees charged by the lender to set up the loan.
- Valuation fees to assess the property’s worth.
- Legal and conveyancing costs, especially when buying or downsizing.
- Discharge fees when paying out or refinancing an existing loan.
- Break costs if you exit a fixed-rate loan early.
- LMI where the loan exceeds 80% of the property value.
- Compounding interest on a reverse mortgage, or the government-set interest on the HEAS, which accrues over time rather than being paid as you go.
Choosing between a broker and going directly to a bank
Both paths can work, and the better choice depends on how complex your situation is. The more your application relies on retirement income, shorter terms, or an exit strategy, the more value there is in specialist guidance.
Going direct to a single bank limits you to that lender’s policies. If your income or age sits awkwardly with their rules, you may be declined even though another lender would have approved you, because maximum age, acceptable income types, and term flexibility vary considerably between lenders.
A Loanworx Group mortgage broker can compare lenders and match your circumstances to the ones whose policies suit older borrowers. This matters because the difference between approval and decline often comes down to which lender’s assessment rules your situation fits, rather than the strength of your application overall. A broker can also help frame your exit strategy and income in the way each lender expects to see it.
Your checklist before applying
A little preparation makes the process faster and improves your chances. Before you apply, it helps to have the following clear and documented.
- A clear purpose: are you buying, refinancing, releasing equity, consolidating debt or funding income?
- Evidence of all income sources, including pension, superannuation, rental, and employment income.
- An up-to-date picture of your assets, debts, and living expenses.
- A realistic, documented exit strategy for repaying the loan in retirement.
- An estimate of your property’s value and your current equity.
- Recent statements for any existing loans and credit cards.
- An idea of the loan term that fits your retirement plans, not just the lowest repayment.
Frequently Asked Questions (FAQs)
1. Can I get a 30-year mortgage after 60?
It is possible but uncommon if you are retired, because the loan would extend well beyond typical working life, and the lender must be satisfied you can repay it throughout. If you are still working, a longer term is more achievable, though many lenders will still want the loan to finish around retirement age unless you have a strong exit strategy. A shorter term is more usual for older borrowers, which raises the repayment but reduces the lender’s risk.
2. Can I use Age Pension income for a home loan?
Some lenders will count the Age Pension as assessable income, but many will not approve a loan based on pension income alone, because it is modest and intended to cover living costs. It is more likely to support an application when combined with other income, such as superannuation, rental income or a working spouse. The treatment varies between lenders, which is one reason comparing policies is worthwhile.
3. What counts as an acceptable exit strategy?
An acceptable exit strategy is a credible, documented plan to repay the loan once your income changes in retirement. Common examples include downsizing, selling an investment property, drawing a superannuation lump sum, or a maturing investment. Lenders treat uncertain plans, such as relying solely on a future inheritance, with caution, because there is no guarantee of timing or amount.
4. Is a reverse mortgage better than refinancing?
Neither is universally better; they solve different problems. Refinancing suits borrowers who can service regular repayments and want a better rate or structure. A reverse mortgage suits asset-rich, income-constrained retirees who cannot or do not want to make regular repayments, accepting that compounding interest will reduce their equity over time. The right choice depends on your income, how long you intend to stay in the home, and your estate plans. A Loanworx Group broker can discuss these options with you.
5. What is the Home Equity Access Scheme?
The Home Equity Access Scheme (HEAS) is a government-backed loan administered by Services Australia that lets eligible older Australians draw on their home equity as a fortnightly payment, a lump sum, or both. It is secured against Australian property, carries a government-set interest rate and a no negative equity guarantee, and is generally more conservative than a reverse mortgage. It suits people wanting to supplement retirement income steadily.
6. Will I need Lenders Mortgage Insurance?
Lenders Mortgage Insurance (LMI) usually applies when you borrow more than 80% of the property’s value. Many older borrowers hold significant equity and borrow well below this threshold, so they avoid LMI altogether. If your loan would sit above 80%, factoring in the LMI cost, or increasing your deposit to stay under it, is worth considering.
7. What happens if one borrower dies or moves into aged care?
This depends on the loan type. On a standard mortgage, the surviving borrower or the estate remains responsible for the loan, and the lender will assess whether repayments can continue. On a reverse mortgage or the HEAS, the debt typically becomes repayable when the last remaining borrower sells the home, moves permanently into aged care, or passes away, usually from the sale of the property. Because the outcomes differ, it is important to understand the terms before signing and to consider the impact on your partner and your estate.
The Bottom Line
Borrowing after 60 is not about whether age allows it, but about whether the income and the repayment plan stand up to scrutiny. Lenders are not closing the door; they are asking a fair question about how the loan will be repaid once work stops, and a well-prepared application handled by an experienced Loanworx Group broker answers it clearly.
The most important decision is matching the option to your actual goal. A standard loan or refinance suits those with reliable income, equity release suits those who are asset-rich but income-constrained, and downsizing or bridging finance suits those changing homes. Each carries different costs and different consequences for your estate and your pension. Taking the time to understand the trade-offs, document a realistic exit strategy, and compare lenders whose policies suit older borrowers will put you in the strongest position to make a confident, well-informed choice.
