Advance payments for Home Equity Access Scheme (HEAS) loans 065-22051321

Customers can apply for a HEAS advance as a lump sum payment, or in addition to their fortnightly loan payment.

Customers can:

• request a HEAS advance payment up to 50% of their annual maximum pension rate
• access up to 2 advance payments of their loan in any 26 fortnight period

The most a customer can advance in any 26-fortnight period is 50% of their annual maximum pension rate.

The calculation for the maximum HEAS Advance amount is:

• Customer’s Maximum Pension Rate (annual) divided by 2
• Less the sum of all HEAS Advance amounts received in the last 26 fortnights

For example, maximum pension rate per annum is $25,677.60 divided by 2 = $12,838.80.

The largest advance available in a 26-fortnight period is $12,838.80.

Note: rates used in this example are point in time and may not be current.

HEAS advance payments:

• reduce the maximum fortnightly loan amount available to the customer for 26 fortnights (364 days from the date the HEAS advance is granted), and
• are added to the customer's HEAS loan balance, which must be repaid to the Commonwealth. Interest calculates on the loan balance, compounding fortnightly

Repaying the advance payment amount during the advance period

Early repayment of the advance will not:

• allow the customer to claim an advance at an earlier date if the customer has previously accessed 2 advance payments in the preceding 26-fortnights
• entitle the customer to automatically start receiving fortnightly payments

See Home Equity Access Scheme (HEAS) for more details and associated costs.

Customers must meet all the eligibility criteria required to participate in HEAS. This is assessed when the request for a HEAS advance is submitted.

Eligible customers will not meet the criteria for an advance payment if:

• 2 HEAS advance payments have been paid in the previous 26-fortnights
• the HEAS loan balance has reached the maximum loan amount (MLA), or
• the maximum HEAS advance payment amount in the current 26 fortnight period has already been received (50% of the maximum pension rate)

Customers approaching the MLA can receive an advance at a reduced amount. The amount is the difference between the current total HEAS loan balance and current MLA.

For example:

John has a total loan balance of $38,000 and an MLA of $45,000.

The sum of $4,5000.00 (MLA) less $38,000.00 (total loan balance) = $7,000.00.

John can access a maximum advance amount of $7,000.00 and MLA is then reached.

HEAS advance payments proportionally reduce the maximum rate of fortnightly HEAS loan payments.

Using the HEAS loan calculator customers can estimate the:

• amount of HEAS advance payment available
• effect on fortnightly HEAS loan payments

Customers can access the calculator using:

• their Centrelink online account, or
• the Services Australia website

To help customers get the estimate on their Centrelink online account, Staff can access the loan calculator through the Home Equity Access Scheme summary page using Customer Online View.

The Resources page contains example calculations.

HEAS advance payments secured against a customer's principal home, are treated in the same way as a home equity conversion agreement. The HEAS advance payment is:

• subject to deeming provisions under the income test from the date the HEAS advance payment is issued, and
• assessed under the assets test after 90 days

When the HEAS advance payment is delivered to the customer's financial institution, it is recorded on the customer's record as an investment via the Direct Investments (SVDI) screen.

Customers can view and update the details at any time via their myGov Centrelink online account under Income and Assets Summary > Banking.

Applying for a HEAS advance payment differs for:

• current HEAS customers, and
• new HEAS applicants

Current HEAS customers

Customers already participating in HEAS can request a HEAS advance using:

• their Centrelink online account via myGov:
• Customers must select Request advance from the Home Equity Access Scheme summary page in their Centrelink online account
• Staff can help customers with their request via Customer Online View
• a Home Equity Access Scheme variation form SA497

New applicants

Customers not already participating in HEAS must submit a new claim to apply for a HEAS advance payment. A correspondence nominee can also do this, on behalf of the customer. They can submit a HEAS claim:

• online, via their myGov Centrelink online account, or
• using a paper form

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

Staff must:

• encourage customers to apply use their Centrelink online account, and
• help customers with their HEAS application by using Assisted Customer Claim (ACC), if required

Lodgement date

HEAS is not bound by claim lodgement provisions under the Social Security (Administration) Act 1999.

When a customer applies for an advance lump sum, the claim:

• will be rejected if they are not eligible on the day of assessment
• is assessed from the date the claim is allocated for processing and all supporting documentation is provided

Written or electronic consent must be provided by:

• the customer's partner (if applicable) when a customer or correspondence nominee requests a HEAS advance payment
• third party property owners who have an interest in the property. This only applies for new advance claims

For more details, see Home Equity Access Scheme consent.

Customers receiving an actual rate of their qualifying pension payment for HEAS, may choose to apply for:

• a HEAS advance payment and/or
• an advance of their pension payment rather than (or in addition to) a HEAS loan

If a staff member identifies suspected fraud, they must report it.

See:

• Report Suspected Fraud and Corruption, and
• Identity fraud