Mondy Financial Services

A Reverse Mortgage is a special type of loan for those 60 years and over, using the equity built up in your home to turn into cash to use for whatever you want – i.e. holiday, living expenses, new car, renovations, health costs.                                                    

Watch this short video to see how others use reverse mortgages.                       

This type of loan does not have to be repaid until you choose to sell your home or the last surviving borrower passes away. It does not require any repayments on the life of the loan but voluntary repayments may be made.

You can receive your money in a variety of ways – as a Lump Sum or have your own “cash reserve” limit which you can then draw down as you need the money, or a combination of both. If you have a current mortgage, credit card bill or other loan this may be able to be paid out for you.

The amount you receive will depend on the value on your property and the age of the youngest borrower. eg a 60 year old may only be able to access 15% of the value of the home where a 90 year old may access 45%.

The No Negative Equity Pledge ensures that you (or your estate) will not have to pay any shortfall between the sale price of your home and the outstanding balance owed when the home is sold.

PROS                                                                                                                    

  • You never need to make repayments for the life of the mortgage
  • You have increased cash flow to use however you want
  • Your credit line grows with time as you get older
  • These do generally not affect your Centrelink entitlements (however you need advice on this aspect)

CONS

  • The value of your estate will decrease
  • Interest rates and costs are high 
  • The balance of the loan grows with time as interest is added to the loan value

An example of a reverse mortgage we assisted with:

A client living in a $1.8M home in Sydney, on a pension and struggled to pay her rates and ongoing expenses. She had one son who was well established and suggested a reverse mortgage. After releasing some of the equity in her home she had the cash to comfortably pay her bills and was able to stay in the home she’d lived in for over 50 years. Her son wanted the best for her and wasn’t worried about inheriting a home with some debt.

Note: This information is general, before acting upon any of these ideas you should seek professional advice to make sure it suits your personal circumstances. If you’d like to discuss options that could benefit you, why not contact me today on 0431 517 455 or email me at This email address is being protected from spambots. You need JavaScript enabled to view it..