HEAS vs Reverse Mortgages 2026: What’s the Best Way to Unlock Your Home’s Equity in Retirement?

As retirement stretches longer and living costs rise, more Australian homeowners are looking for ways to safely free up cash without selling their home. In fact, recent data in 2026 shows an uptake of the government’s Home Equity Access Scheme (HEAS), with thousands of retirees turning to equity release to combat persistent inflation as the value of their property increases in metro areas such as Sydney, Perth, Melbourne, and Brisbane. 

While the HEAS is seeing an uptake, it isn’t the only path when it comes to accessing equity in your home. Private reverse mortgages remain a valuable and powerful alternative. Both options allow you to access the wealth and equity in your home without moving, but they’re very different products, with different benefits, costs, and risks.

Here’s what you need to know before making a decision.

What Are The Different Equity Release Products?

The Home Equity Access Scheme (HEAS)

The HEAS is a government-run scheme that lets eligible Australians get 26 fortnightly payments per year (or the equivalent value per 12 months) from Centrelink, using their home equity as security.

• It is designed to top up the Age Pension or provide retirement income.
• Run by Services Australia.
• HEAS loans are repaid later — typically from your estate or when the home is sold.
• It is ONLY for those of Age Pension age (67+)

The reality check: While there is record enrolment in the HEAS, the HEAS was built primarily as an income supplement tool, designed to offer you a top-up fortnightly cash flow and not pay for large payments. Many retirees who are signing up only find out about the strict rules and limits later in the application process.  

Commercial Reverse Mortgage

A reverse mortgage is a private loan from a bank or lender, secured via a first-registered mortgage against your home.

• You can receive a lump sum, regular income, or a line of credit.
• No regular repayments are required while you live in the home.
• The loan plus interest is repaid when you sell or pass away.

For Australians needing more substantial funding, maximum flexibility, or a younger entry age, a commercial reverse mortgage remains the industry benchmark. 

Key Differences of Equity Release Products at a Glance

Feature	HEAS	Reverse Mortgage
Provider	Government (Centrelink)	Banks or private lenders
Eligibility	Age Pension age (67+), own Australian property	55+, own property
Loan Type	Fortnightly payments, or up to 26 payments in advance per year.  The amount available depends on how much Age Pension you receive. OR Modest lump sum payments of max circa $15,300 for singles and max circa $23,100 for a couple.	Lump-sum or flexible access. Available as large lump-sum payments.
Interest Rate	3.95% p.a. (May 2026)	Typically, 7.60% to 9% p.a. (May 2026)
Loan Limits	Up to 150% of Age Pension	Up to 150% of the Age Pension
Use of Funds	Restricted: Strictly for lifestyle and retirement income top-up	Unrestricted: Suitable for debt consolidation, renovations, medical bills, travel and more.
Fees	Minimal	Includes setup costs, legal fees, govt charges
Access Speed	Slower — via Centrelink	Faster — via lenders and brokers
Negative Equity Protection	Yes (government guaranteed)	Yes (since 2012)

Similarities Between HEAS and Reverse Mortgages

• You stay in your home — no need to sell.
• No regular repayments are required.
• Interest compounds over time, increasing the loan balance.
• Both are regulated and include negative equity protection.
• Both reduce the value of your estate over time.
• Both offer lump-sum payments as of 2026; however, there is a limit on the amount the HEAS allows, up to $23,100 for couples or $15,300 for singles, while there is no limit on a reverse mortgage. 

Pros & Cons of Each Option

HEAS Pros

• Low, government-backed interest rate (currently 3.95%)
• Safe and simple product
• Great for conservative retirees who want a steady income or whose need for funds is lower

HEAS Cons

• Modest payments only — not suitable for expenses larger than $15,300 for a single or $23,100 for a couple. 
• Limited flexibility
• Processing is slow — managed through Centrelink
• Only for those over 67 years of age
• Can be confusing what amount is available per annum

Reverse Mortgage Pros

• Access larger amounts (great for aged care, debt consolidation, etc.)
• Access a clearer amount of money to meet your objectives
• Choose lump sum, income stream, or line of credit
• Flexible use of funds — your money, your way
• Younger Application age of 55+

Reverse Mortgage Cons

• Higher interest rates (rates up to 9.00% [May 2026])
• Set-up fees will apply. 
• Interest compounds faster — a higher rate of interest means the loan balance grows more quickly
• Can affect Age Pension if not structured correctly

Which Equity Release Option is Right for You?

You want…	Best fit
A modest top-up to your pension for everyday costs	HEAS
A lump sum for medical, debt, or aged care	Reverse mortgage
Maximum flexibility and control	Reverse mortgage
A low-risk, low-cost way to access small amounts of equity	HEAS
Fast access to equity	Reverse mortgage

Our take: Structure Matters More than the Product

Choosing between HEAS and a reverse mortgage isn’t about one being better than the other — it’s about what fits your goals, income needs, estate planning, and Centrelink position.

Many retirees can even use both, strategically, depending on what stage of retirement they’re in.

Our Final Word

Your home is more than just a place to live — it’s often your biggest financial asset. If you want it to support your retirement, make sure you use it wisely.

Understanding the difference between HEAS and reverse mortgages will assist you in choosing the right option for you.

Want to Find Out What You Qualify For?

We specialise in helping older Australians unlock the wealth in their homes and can assist you to compare your options clearly, avoid impacts to your Centrelink, and structure equity release around your lifestyle, goals, and future care needs.

Check out what you qualify for by completing our Reverse Mortgage Calculator, or get in touch with us today — whether you’re just starting your research or ready to take the next step.