Home Equity Access Scheme (HEAS) 065-08000000

HEAS is a voluntary arrangement that provides financial support to customers in the form of a non-taxable, government funded loan.

A HEAS loan:

• accrues compound interest each fortnight, currently 3.95% per annum, until repaid in full
• is secured against Australian real estate owned by the customer and/or partner

Customers:

• can repay the loan electronically in full or in part at any time (even though there are no mandatory repayments) via:
• their Centrelink online account
• BPAY®, or
• Post Billpay
• must settle the loan:
• at the sale of the secured property, or
• through the deceased customer’s estate

HEAS loans are paid as fortnightly payments, an advance lump sum or a combination of both for short or indefinite periods until their HEAS loan balance reaches their Maximum Loan Amount (MLA).

The MLA is based on the age of the customer and partner (if applicable) and how much equity there is to offer as security.

Customers should seek independent legal or financial advice before applying for a loan under HEAS.

The original Scheme was set up in 1985 when the assets test was introduced.

On 10 July 1996, a new scheme commenced and applications were no longer accepted under the old (1985) provisions.

Before 1 July 2019 to be eligible:

• customer’s qualifying payment rate had to be a reduced rate because of their income or assets
• Nil rate customers could apply as long as their pension rate was reduced to nil by only one (not both) of the income or assets tests

On 1 July 2019, the scheme expanded:

• to increase the maximum fortnightly loan rate to 150% of the applicable pension rate, and
• allowed maximum rate pensioners to participate in HEAS

On 1 January 2022, the Scheme was renamed HEAS.

On 1 July 2022, the Scheme introduced access to lump sum advances and a No Negative Equity Guarantee.

Complex Assessment Officers (CAO) are responsible for all decisions relating to HEAS claims and change of circumstances.

Front of House and Smart Centre staff who have contact with customers enquiring about Home Equity Access Scheme (HEAS) are required to answer basic enquiries such as:

• Customer’s Eligibility for Home Equity Access Scheme (HEAS)
• Eligibility for the Home Equity Access Scheme (HEAS)
• Customer requests for Advance Payments for Home Equity Access Scheme (HEAS)
• Advance payments for Home Equity Access Scheme (HEAS) loans
• Customer requests repayment of their Home Equity Access Scheme (HEAS)
• Repayment of Home Equity Access Scheme (HEAS) loans
• Customers advises of Change of Circumstances that effect their Home Equity Access Scheme (HEAS)
• Change of circumstances – Home Equity Access Scheme (HEAS)
• Customers advises Settlement of Home Equity Access Scheme (HEAS)
• Settlement of Home Equity Access Scheme (HEAS) loan amounts
• Customer requests to apply an extension to their Home Equity Access Scheme (HEAS) Review
• Process Tab – Table 4 – Applying an extension to a HEAS review – all staff - Home Equity Access Scheme (HEAS) reviews

And provide resources such as:

• Home Equity Access Scheme (HEAS) – Services Australia website
• Home Equity Access Scheme - Services Australia
• Payment and Service Finder for customers to explore what payment and services they may be eligible for
• Payment and Service Finder - Services Australia
• Assist customers with setting up a myGov account and/or a Centrelink Online account
• How users create a myGov account and link services
• Accessing and using Centrelink self service

Provide HEAS customers who do not have online access information such as:

• HEAS Loan balance,
• Maximum Loan Amount, and
• Nominated Amount

This information is all available in Customer First/Process Direct through the HEAS Summary (PLSS/HEAS) screens.

• Provide HEAS customers with assistance issuing a HEAS Itemised Statement.

Staff can issue a HEAS Itemised Statement through Process Direct – HEAS screen, selecting Action, Edit and Print. All Itemised Statements are printed centrally due to Do Not Send (DNS) filter being applied as per Network News Update (NNU).

National News Update for Itemised Statement:

NNU - PD - UPD - HEAS - Some itemised statements include incorrect information

Note: HEAS Itemised Statement can only be provided in Process Direct from 4 December 2021. Any customer request for an Itemised Statement prior to 4 December 2021 will need to be sent to the Home Equity Access Scheme (HEAS) National team.

Services Australia Front of House and Smart Centre staff should only be transferring customers in the event customer are considering claiming HEAS and complex financial enquires. In these circumstances staff should refer them to Financial Information Service (FIS).

If an existing HEAS customer has a complex enquiry not outlined in the above scenarios staff may refer them to Home Equity Access Scheme (HEAS) National team.

The Resources page contains:

• Frequently Asked Questions (FAQ) and answers for staff
• links to forms, and
• Process Direct screens

Customers can request variations to their loan.

Customers can use their Centrelink online account to:

• Make repayments via:
• BPAY®
• Post Billpay, or
• credit card
• Stop fortnightly payments
• Change fortnightly payments
• Start fortnightly payments
• Request an advance
• See transactions on their loan, and request an itemised loan statement

Customers can use the Home Equity Access Scheme variation form (SA497) to request the following:

• Settle the loan
• Request an advance payment
• Stop fortnightly loan payments
• Start fortnightly payments
• Add property or change the property the loan is secured against
• Change fortnightly payments
• Change or add a maximum loan amount
• Change or add a nominated amount

Customer requests to start, stop or change fortnightly loan payments

• Customer can start, stop or change their fortnightly loan payment at any time
• The request can be done:
• online, see Consent required for online requests for more details, or
• in writing by completing a Home Equity Access Scheme variation form (SA497). The SA497 must be signed by the customer, and their partner (if they are a member of a couple)
• Interest continues to accrue on the outstanding loan amount, compounding fortnightly until fully recovered
• Customers wanting to make large repayments on their HEAS loan balance may affect the No Negative Equity Guarantee

See Change of circumstances – Home Equity Access Scheme (HEAS) for details.

The Resources page contains a link to the SA497 form.

Do not escalate general enquires about:

• application timeliness, or
• the progress of a HEAS claim

If a customer asks about their HEAS application, confirm lodgement and advise it will be allocated for processing in due course.

Where a HEAS applicant advises they are;

• experiencing vulnerability
• is assessed in financial hardship, or
• imprisoned

and are either:

• receiving a qualifying payment:
• were previously receiving a qualifying payment: or
• has been suspended/cancelled due to imprisonment and claiming a HEAS Only payment

See Immediate new claim and non-new claim priority processing.

Where the HEAS applicant has been determined to be on a qualifying payment or was receiving a qualifying payment and has been suspended/cancelled due to imprisonment, and meets the assessment for priority processing, escalate to Home Equity Access Scheme (HEAS) National team .

Other HEAS enquiry types that should be escalated to the Home Equity Access Scheme (HEAS) National team include:

• making a repayment
• settling a HEAS loan
• when instructed by Operational Blueprint

See:

• Eligibility for the Home Equity Access Scheme
• HEAS - only customers
• Claiming a Home Equity Access Scheme loan including:
• required documentation, and
• Department of Veterans’ Affairs (DVA) claims

A HEAS loan amount a customer owes under HEAS can be deducted from the value of the customer's assessable real estate for social security payments or benefits.

The amount owing increases with each payment made under HEAS:

• the value of the customer's assessable assets may decrease (depending on whether the value of the asset is appreciating)
• their pension payable under the assets test may increase, and
• this may lead to the customer’s fortnightly loan amount reducing

No reduction in the overall value of assessable assets occurs where the person's principal home is the security for a HEAS loan as this is an exempt or non-assessable asset. The only exception is when the principal home is partly assessable because the house and curtilage exceeds 2 hectares and does not meet the extended land use test.

A person cannot be paid under both HEAS and under asset hardship provisions.

If a person is receiving income support under asset hardship provisions, this does not prevent them from being able to lodge a request for payment under HEAS. However, payment can only be made under one or the other provision.

HEAS is also open to self-funded retirees so long as they qualify for (but not necessarily receive) one of the qualifying pensions.

This may be because they:

• are not eligible to receive a pension under the income and assets test
• have chosen not to claim a pension, or
• are not eligible to receive a pension due to payability reasons, and remain qualified and therefore are eligible to receive Home Equity Access Scheme (HEAS) Only payments

For more information, see Change of Circumstances – Home Equity Access Scheme (HEAS) for further information.

Note: Farm Household Allowance (FHA) customers may be eligible to receive Home Equity Access Scheme (Loan Only). This would apply where the customer would not otherwise receive an Age Pension because of their income and/or assets.

Customers who receive their entire payment as a HEAS loan without any qualifying payment components are ‘loan-only’ customers. These customers do not meet the definition of an income support payment (ISP) recipient, as they do not receive a payable rate of a social security pension or benefit.

Staff can identify a loan-only customer if a HEAS qualifying payment is Current Zero Rate (CZR) because of nil rate reason PLS.

HEAS-only customers are not entitled to a Pensioner Concession Card (PCC). However, some customers may have a grandfathered entitlement to a non-pensioner PCC (see Pensioner Concession Cards (PCC) for details).

Note: Complex Assessment Officers (CAO) who complete a HEAS only application will need to contact and advise the customer or approved nominee that they may be qualified to receive a Commonwealth Seniors Health Card (CSHC).

If the customer requests to test their eligibility for qualification to a CSHC, the CAO will need to send a Commonwealth Seniors Health Card (SA296) form. HEAS only customers cannot currently complete an online or Assisted Customer claim. For more information see Eligibility for a Commonwealth Seniors Health Care Card.

Customers that get their income support payment entirely as a loan payment under HEAS, can only be transferred to Age Pension.

Before transferring a HEAS only customer to Age Pension, Age Processing must contact the Home Equity Access Scheme (HEAS) National team to determine if the transfer is appropriate.

See Step 12 in the Manual reviews table for more details.

Department of Veterans’ Affairs (DVA) customers can use Home Equity Access Scheme (HEAS) to supplement their retirement income through a HEAS loan from DVA.

DVA HEAS applicants can apply for non-taxable loan payments from DVA by using a property.

DVA HEAS applicants can choose how long they want to receive DVA HEAS loan payments, including for a short time for expenses, or indefinitely.

See Claiming a Home Equity Access Scheme (HEAS) loan and Assessing Home Equity Access Scheme (HEAS) applications for more details.

Note: where a customer provides a DVA – Home Equity Access Scheme Loan Application (D2662) form through Services Australia’s face-to-face services, see Delivering face-to-face services for the Department of Veterans’ Affairs (DVA) that outlines the roles and responsibilities on behalf of DVA.

• HEAS loan payments are paid as a rate component of the qualifying pension
• Loan payments display on the Payment Details (PD) screen as:
• LON for fortnightly payments, and
• LONA for advance payments
• For the loan-only customers, this is the only component that displays
• The loan information displays on the Home Equity Access Scheme Summary screen in the customer’s Centrelink online account

• The maximum HEAS rate payable per fortnight is 150% of the maximum payment rate of the qualifying payment (1.5 times the maximum payment rate of the qualifying payment)
• The maximum payment rate is the sum of the maximum basic rate of pension, and any supplements (for example, Pension Supplement and Energy Supplement) and Rent Assistance a person is eligible for
• Customers can get:
• fortnightly payments
• lump sum advances, or
• a combination of both
• The maximum fortnightly amount available reduces if the customer has received an advance payment in the last 26 fortnights
• Customers can choose the amount of fortnightly payment that they would like to get
• They can choose to get:
• the maximum amount available (loan type ‘maximum’), being 150% (1.5 times) the maximum payment rate
• a percentage that is lower than 150% (loan type ‘percent’). For example, 120% p/f (maximum payment rate x 1.2) or 80% (maximum payment rate x 0.8), or
• a fixed flat rate (loan type ‘fixed’) for example, $500 p/f

If a customer gets a pension:

• the loan is added to the pension each fortnight
• the combined amount of pension and loan can’t exceed 150% of the maximum payment rate
• the loan amount will automatically increase or decrease:
• if their pension rate changes in order to maintain their chosen percentage for that fortnight (which may be 150% or a lower percent)
• if a customer does not want their loan amount to increase over a certain amount:
• they can choose to receive a fixed loan amount each fortnight
• the combined fixed rate of loan and actual pension rate can’t exceed 150% of the maximum rate of pension

If the customer or their partner received an Adjusted Disability Pension from DVA, their maximum payment rate for HEAS purposes would have been affected by any Defence Force Income Support Allowance (DFISA) they received. The maximum HEAS rate reduced by the amount of DFISA received. This ensured that a person could not receive above the maximum payment rate in income support payments.

Note: DFISA was introduced on 20 September 2004 and ceased on 1 January 2022, when Adjusted Disability Pension became exempt income under the Social Security Act 1991. Retrospective DFISA assessments and payments may still occur for periods prior to 1 January 2022.

The Resources page has examples of rates payable.

See Advance payments for Home Equity Access Scheme (HEAS) loans for details.

• NNEG only applies when a customer settles their HEAS loan
• Customers are not required to repay more than the current market value of the property/s used as security, less any mortgages or encumbrances
• NNEG will not apply if a customer:
• intentionally increases encumbrances (such as mortgage) on the secured property and limits the Commonwealth’s ability to recover the full amount of the loan balance, or
• misrepresents their circumstances while participating in HEAS, or
• commits fraud

The MLA:

• is the loan balance at which a person’s fortnightly payment will stop. They will not be eligible for an advance payment depending on:
• the value of their equity in Australian real estate, and
• their HEAS age component based on the customer’s age, or in some cases their partner’s age if they are younger
• is not necessarily a fixed set amount
• is re-calculated:
• at least once every 12 months when the person’s age component is reassessed on their (or their younger partner’s) birthday
• when there’s a change in circumstances (for example, changed value of the secured real estate, separation)

Complex Assessment Officers (CAO) assess MLA at the time of assessing a HEAS claim.

The customer:

• can ask to change their MLA at any time:
• online via HEAS summary security and loan amounts (preferred method), or
• by completing a Home Equity Access Scheme variation form (SA497)
• can increase their MLA if they have enough loan security for the higher amount:
• online via HEAS Summary update my circumstances or in writing
• if partnered, their partner must give written/electronic approval to increase the MLA
  Note: even if the partner is not named as an owner in the title certificate or title search of the property

See Security for the Home Equity Access Scheme (HEAS) on how the MLA is calculated.

The Resources page contains links to the SA497 form and to the Payment and Service Finder on the Services Australia website.

HEAS loan balance

The amount the customer must repay to the Commonwealth.

It is:

• the sum of the principal loan payments made to the customer
• plus legal costs
• plus previously accrued interest
• less any repayments made by the customer

Compound interest

Interest is charged on a HEAS loan balance each fortnight until the outstanding loan balance is repaid in full.

The interest rate for HEAS is currently 3.95% per annum – compounding fortnightly. The last interest rate change occurred on 1 January 2022.

Compound interest:

• increases the amount the customer must repay to the Commonwealth, and
• may mean the person’s total loan balance increases beyond their maximum loan amount (MLA)

The interest rate is set by the Minister for Families and Social Services, and is published in the Australian Government Gazette.

The Resources page contains the compound interest calculation details.

Legal costs

Costs incurred by the Commonwealth in registering, changing and removing the charge and/or caveat on the real estate used by the customer to secure repayment of a HEAS loan.

These costs:

• depend on the customer’s circumstances (for example, how many properties they offer)
• are payable by the customer
• get added to their HEAS loan balance
• accrue compound interest

The agency notifies the customer in writing when the legal costs are added. The customer can choose to pay the costs immediately or at another time.

Note: if a customer or nominee wishes to know the balance of their current loan information, see the FAQ’s on the Resources page

Itemised statement

Itemised statements are sent to customers around their (or their younger partner’s) birthday and includes information about:

• the loan amount paid including any advance payments
• the interest accrued
• the costs associated (such as legal costs)
• other transaction amounts (for example, payments, repayments, interest accrual) on the loan

The online claims or change of circumstances submitted through the online service must provide consent from the customer and partner (if applicable).

Nominees can provide consent on behalf of the customer if they submit a HEAS loan application, and hold legal authority. Supporting medical or treating doctor documents must be provided.

Nominees lodging a HEAS loan application online for a customer must:

• have legal authority
• download and sign the consent form to send the HEAS loan application

A nominee with legal authority that is unable to download a copy of the consent letter, can attend their local service centre or contact the smart centre. Staff can generate a Q888 Consent to add property to Home Equity Access Scheme letter. See the Letters sub-site for a template.

See Home Equity Access Scheme consent for more details.

The Resources page contains examples of consent requirements.

Customers can make repayments via the Home Equity Access Scheme summary page on their Centrelink online account using:

• BPAY®
• Post Billpay, and
• credit and debit cards

There are no mandatory repayments over the life of a HEAS loan.

The outstanding HEAS loan amount must be repaid to the Commonwealth, including:

• legal costs
• accrued interest

The Agency will pursue settlement of a HEAS loan when:

• the property used to secure the loan is sold during the life of the loan
• the customer is deceased and there is no surviving partner over Age Pension age,
• the loan amount will be recovered from their estate unless a surviving partner is over Age Pension age, and
• a Deceased Estate Letter is sent and is followed by a Deceased Loan Statement each year to the executor

If a customer intends to sell the real estate which currently secures an outstanding loan amount, they must contact the agency before settlement to arrange for repayment upon the settlement of the property.

For more details, see:

• Settlement of Home Equity Access Scheme (HEAS) loan amounts
• Repayment of Home Equity Access Scheme (HEAS) loans

• Customers have the right to request an explanation or a formal review of any decisions made under HEAS
• Requests are assessed by a Subject Matter Expert (SME) which is usually a Complex Assessment Officer (CAO) in the Home Equity Access Scheme (HEAS) National team
• If a customer requests a review of decision, run the Internal Review/Explanation script via Customer Record:
• See SME explanations, ARO referrals and implementing ARO decisions for more details
• The Resources page contains Appeal codes for the Original Decision, and the Reason for the Original Decision