Recent research by Seniors First identified more than 150 differences in reverse mortgage offerings among the country’s four largest lenders. These variations include eligibility requirements, loan features, available loan amounts, total fees, and lender policies.
“The reverse mortgage landscape in Australia is more complex than ever,” said Darren Moffatt, chief executive of Seniors First. “Our research uncovered over 150 variables across just four lenders.
“That level of complexity is overwhelming for many over-60s who are simply trying to access the equity in their homes for cash, without making a costly mistake. From differences in drawdown limits and interest rates, to rules around property types and age-based loan eligibility – it’s a minefield.
“For example, one lender might impose restrictions around the cash reserve feature that another doesn’t, or they might scale back the available loan amount based on property type or location.”
Moffatt added that the availability of comprehensive and transparent information on reverse mortgages has not kept pace with the product’s growing popularity among older borrowers, leading to varying levels of financial confidence.