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Reverse Mortgage Loan Frequently Asked Questions

If you haven’t used a finance broker before, you probably have some questions. Let’s help you get some answers.

Are reverse mortgage payments tax free?

Generally, reverse mortgage payments are tax-free as they are not classed as income and are instead classed as loan proceeds. However, this can vary depending on each individual situation and the current tax rules set by the Australian Taxation Office (ATO). It’s important to confirm your tax obligations directly with your account or the ATO.

Can a reverse mortgage be refinanced?

It is possible to refinance a reverse mortgage. But, reverse mortgages can be more complicated than standard home loans, so it can be beneficial to consult a mortgage broker.

At Oceania Finance, our versatile team has extensive experience across all home loans, including reverse mortgages. We’ll guide you through the process and make sure you get the best deal for your individual circumstances. Contact us today for more information.

Can a reverse mortgage be paid off?

Typically, a reverse mortgage is paid off when the home is sold, you pass away, or when you enter into aged care. While it is possible to pay off a reverse mortgage early, it’s important to note that there may be fees or penalties associated with early repayment, depending on the terms of the loan agreement.

Does a reverse mortgage affect your pension?

Whether or not a reverse mortgage will affect your aged pension will depend on:

    • Your individual circumstances
    • The purpose of your reverse mortgage
    • How you receive your reverse mortgage payment (i.e. in a lump sum or through regular payments)

If you are planning on taking out a reverse mortgage, it is best to contact a financial adviser or a mortgage broker to understand how a reverse mortgage will impact your pension and financial situation.

If you need advice on reverse mortgages, have a chat with Oceania Finance mortgage brokers today!