Pension Loan Scheme

Are you still waiting for your Home Care Package? Often, during this waiting period, you’ll need a bit of extra care to make sure you stay well. Whether it’s someone to mow your lawns, do your shopping, clean your house, or a bigger project such as a bathroom renovation, you may need to contribute to the cost of it yourself.

There are several ways in which you can access money other than your savings to pay for services while you wait for your Home Care Package. One of these is the Pension Loans Scheme. 

What is the Pension Loans Scheme?

The pension loans scheme is a tax-free loan from the government. It works in a similar way to many other loans, accruing interest over time. To receive this loan, you must have an Australian property to put up as security. If you do not own a property, you won’t be able to access this loan. 

Who can get the Pension Loans Scheme?

To be eligible, you must meet the following criteria: 

  • be of pension age (65 years and over), or have a partner who is of pension age
  • be eligible to receive a pension
  • own Australian property
  • have adequate insurance on your owned property
  • are not bankrupt or subject to personal insolvency

How much money can I borrow?

There is a cap on how much you can borrow. The Pension Loans Scheme is paid to you in fortnightly payments, which, in combination with your regular pension payment, cannot be more than 1.5x your maximum pension rate. It can be a bit hard to work all of that out, so thankfully, there’s an online calculator! Find out how much you can borrow here.

Are there any additional costs?

As well as repaying the loan amount itself and the accrued interest, there are also legal costs, including set up and exit costs. If you’re putting up more than one property as security, you’ll have to pay these costs multiple times, once for each property. Therefore, if possible, try to use one property only as security. 

Repaying the loan

The Pension Loans Scheme must be repaid if and when you sell your property, or repaid from your estate. You can also choose to make regular repayments if you wish – though you don’t have to. However, if you choose not to make repayments, be aware that the interest will accumulate the longer you hold off on repayments. The Pension Loans Scheme accrues interest at a rate of 4.5%*, and compounds each fortnight. 

*accurate as at September 2021

How do I apply?

There are four ways that you can apply for this loan; online, downloading and mailing forms, via phone, or in person. Before applying, make sure you check your eligibility and are sure you understand your financial situation and the arrangements of the loan.

Need Financial Advice?
It is often recommended that you seek independent financial advice. CareAbout has partnered with expert Financial Advisers, and we’d be more than happy to connect you with one of them.


If you’re happy using a computer, the easiest way to apply for the Pension Loans Scheme is online. To do this, you must have a myGov account that has been linked to Centrelink. 

You can also download the forms below and mail them to Centrelink, Reply Paid 7800, Canberra BC ACT 2610. You can also drop the forms off at any Centrelink service centre.


If you prefer to do apply over the phone, call Centrelink’s Older Australians line on 132 300.

In person

To apply in person, visit a Centrelink service centre. Find your nearest one, here.