Can I claim rental assistance?

Gwenda is horrified at that rate at which the debt of her reverse mortgage is accruing.

Dollar sign in life preserver concept for rent help

Because Gwenda is horrified at the rate at which the debt on her reverse mortgage is accruing, she is wondering if she can claim some kind of rental assistance.

Q. Gwenda

I have a reverse mortgage on my home, which is growing exponentially, and I currently receive the full Age Pension.

Is there any way I can claim ‘rental’ assistance as I’m basically renting here, seeing as I’m accruing a debt from staying in my home?

A.

You can only receive rent assistance if you actually pay rent. As you own the property, the value of which is excluded from your assets, you cannot claim rent assistance.

This is the same as anyone who pays a conventional mortgage on their property, while you may be accruing a debt, the value of your home will most likely be appreciating. However, if you are concerned about the rate at which your debt is growing, you should seek advice from an independent financial advisor.





    COMMENTS

    To make a comment, please register or login
    roy
    2nd Sep 2016
    10:35am
    You sound like someone from the top end of town!
    Theo1943
    2nd Sep 2016
    11:18am
    No, she's just telling it like it is. Reverse mortgages are a trap, making the bank rich and the customer poor.
    poorwomanme
    2nd Sep 2016
    11:56am
    Nasty, nasty Fred.
    Stop being a Flintstone.
    This lady has made it plain that she is asset rich and cash poor, what sort of a person would you call her if she said she couldn't be bothered with looking at all options?
    HarrysOpinion
    2nd Sep 2016
    12:33pm
    I agree Theo that reverse mortgages are a trap.

    2nd Sep 2016
    11:41am
    Isn"t this the reason pensioners are called names such as bludgers etc as they want everything for nothing.
    Lookfar
    2nd Sep 2016
    11:42am
    Thankyou Gwenda, for pointing out a very important element in the reverse mortgage debate, that as well as losing our homes, the banks charge US compound interest as if we were borrowing from them.

    Well, it is an arguable point, - they charge us compound interest when we borrow from them, eg with a bankcard etc, so should we also pay on the other side?
    Whether they are morally or legally entitled to do so is worth looking at, but that they currently do is important, - we may think our house worth 300 thousand or three million will give us X number of years which is way longer than we expect to live, but with compound interest that time will decrease, as Gwenda says, Exponentially, ie the faster it falls the faster it will fall, we may remember the ancient Chinese story about a philospher who saved the country and wanted only, in payment, some rice, on a chess board, 1 grain on the first square, 2 on the second 4 on the 3rd, 8 on the 5th, etc, - sounds very reasonable doesn't it, but by the time you get to square 48, it is more grains of rice than is estimated by some to be the number of atoms in the universe.
    My recollection is that the Emperor had the philosopher's head removed, and I suspect that the reason Christ overturned the money lender's tables in the temple was because they were charging compound interest.
    Anonymous
    2nd Sep 2016
    3:48pm
    I can't agree Lookfar, when you apply for a reverse mortgage, what is actually happening is that you are borrowing from the bank and providing your home as security. Interest is charged at an agreed rate and period and if that interest isn't paid, it becomes principal and is subject to interest being charged against it.
    LiveItUp
    3rd Sep 2016
    7:14am
    All that is happening is that she is capitalising interest. I do this myself when I can earn more on the money than it is costing me to borrow it in interest. However the difference is that is is spending the money not investing it and using the extra money earned to live on.
    poorwomanme
    2nd Sep 2016
    11:45am
    It's off topic from the original but reverse mortgages are good if you have no wish or need to leave your major asset, your house, to anyone, like children or family.
    If you want to spend your retirement cruising or flying around the world or exploring Australia and have no beneficiaries that you will upset(or don't care for) then why shouldn't you change your life and free up your money.
    Why should we, upon retirement, vegetate because we have no cash flow, when we have a perfectly good asset that can free us up and make for some wonderful years after our working life.
    I can't see your logic Theo1943 unless you plan on being buried in your home?
    Now if you have family........................
    Lookfar
    2nd Sep 2016
    12:00pm
    The discussion is about the interest charges, not about whether you can sell your house and fly around the world on the proceeds, and it is an important point as there is an element in the Govt, - especially the (neo) Liberal side, which would like to force every one with a house to reverse mortgage it instead of getting the old age pension, and then to rub salt into the wound the greedy banking crowd will want to charge compound interest, - either on the money drawn down, or worse, on the whole value of the house, so even one flight may be risky.
    Theo is correct, reverse morgages are a trap, particularly as they are at the present married to the ultimate parasitical leech, Compound Interest.
    LiveItUp
    3rd Sep 2016
    7:20am
    I agree people should be using their assets including their house to pay for their retirement instead of relying on welfare. After all once you are dead you no longer need a house so why not use it to fund your retirement. After all that is what people do who don't qualify for welfare. They use their assets to fund their retirement. I can''t see why anyone with assets should not be required to do this.

    Of course if you don't pay back the interest you then pay interest on that debt plus the interest.
    Hasbeen
    2nd Sep 2016
    12:03pm
    I can live quite comfortably on the pension, in my own home, even though the rates keep increasing more than any other expense. I can even afford the maintenance bills, & still afford a few small luxuries.

    Perhaps Gwenda expects to enjoy more luxuries than she can fund from the tax payer funded pension. If that is the case, that is fine, & I hope she enjoys them. However if she wants to spend more money she has a reverse mortgage top allow her to do it. Perhaps she should be happy she has that facility, & not expect our kids to pay even more money from their earnings to give her those luxuries.
    Jannie
    2nd Sep 2016
    2:24pm
    Look at the overall picture, one can live on the pension but if you have a mortgage it is impossible.
    Lippy
    2nd Sep 2016
    12:19pm
    Time to downsize your house, pay out your debt and understand that the government is not a bank. I had to leave work, am caring for 2 members of my family and paying a mortgage. IF time get tough, would consider downsizing but asking for rent assistance is just not offered if you have assets. You could maybe look at mortgage assistance from Department of Housing.
    Jannie
    2nd Sep 2016
    2:22pm
    What is not fair is that Centrelink add up all of your assets but do not consider the debts you have.
    Anonymous
    2nd Sep 2016
    6:31pm
    jannie, who made those debts, you or the government?
    counting pennies
    2nd Sep 2016
    6:46pm
    A reverse mortgage is freeing the equity of your home for other uses.How its used is up to the individual,but the cash is borrowed from the bank and accrues interest like any other loan,You have the option to pay the loan back.If you dont the amount owing compounds.So start paying it back or be happy with your decision.You cant have your cake and eat it too
    Lookfar
    2nd Sep 2016
    7:15pm
    As i mentioned earlier, this is not an excuse to savage Gwenda, but simply to realise the large negative effect of compulsory reverse mortgage, which is not necessarily freeing the equity of your home at all, but simply the Govt. selling it to the banks in return for the banks paying your pension, no talk of interest in those proposals, but suddenly we find from Gwenda that there is not only interest, but Compound interest, so the Bank gets to have your cake and eat it also.
    You lose your home and your pension, leaving you to eat chagrin or grief.
    LiveItUp
    3rd Sep 2016
    7:25am
    Banks have every right to charge her interest on the total debt owing. I am sure you expect the banks to pay you interest on the balance of your bank account not the amount you originally had before interest was added. That is how the system works so stop blaming the banks.
    Boof
    3rd Sep 2016
    5:44pm
    I'd rather like to know, "How do aged pensioners, obtain Dental assistance?" It is a disgrace. Dr's can bulk bill. Dentists were overlooked & charge what they like.
    Foxy
    3rd Sep 2016
    6:13pm
    Hey Boof - they don't! Ya' teeth simply rot - drop out - and then you live on porridge and liquids! lol lol ......... just being sarcastic 'cause I just went for a check-up (which I hate) and the dentist emailed me with an approx. bill for work needing to be done! Could go on a world cruise with the anticipated cost - lol - forget i!!!!!! :-)
    Young Simmo
    3rd Sep 2016
    11:31pm
    Hey Boof and Foxy, I don't know about the other states, but over here in WA we have a Govt assisted system for pensioners. I am currently going through a process. I had my last 4 bottom teeth removed and going through the process of getting a bottom plate. Total cost $242.00 all up. Better than $1000 plus. OK your down town dentist might complete the process in 4 weeks, and mine is going to take 6 months, but the deal suits my financial situation. It all happens at a beautifully set up dental surgery at the local hospital.
    counting pennies
    4th Sep 2016
    2:32am
    Lookfar,Noone is savaging anyone.The Govt is not selling your house,You have the house,you do what you want.Why dont people sell the large house for something smaller and more manageable? Oh,while we are at it ,why dont people in public housing who no longer need 3 beds cause the family has moved on,insist they stay? BTW I am a single working woman,55 yo,who has helped 2 of my 3 children to independence,the 3rd has impending unemployment due to the Masters story.He,his wife and their 9 week old live with me
    Lookfar
    4th Sep 2016
    3:14pm
    Counting Pennies, I am talking of the proposals that right wing liberals have made that pesioners with houses should be forced into a reverse mortgage situation where their pension is paid from the proceeds of that.
    This is not mainstream Liberal policy at this time, just putting their toes in the water, so they can deny actually making the step if the water is cold.
    What is interesting is that that reverse mortgage on their house, as Gwenda complains, is being charged out to her at Compound interest rates, so the value of her house can disappear very quickly, upon which she would no doubt be evicted, - what I am saying is that reverse mortgage as a policy would be very destructive to old folk who own their houses and should be fought tooth and nail, and folk who have woken up to this evil proposal should not be told they can't have their cake and eat it, - esoecially as the Banks will both have and eat the 'cake', ie Gwenda or whoever's house.
    I hope you can think about that scenario, you get to pension age, the Govt puts a lien on your house so you can't sell it or have a limited time to sell it, (sorry, not our fault the market is depressed and your house is valued so low) and no doubt the govt would give it firesale value anyway, (even lower) as in resuming land for a highway etc, so now it is their house, not yours, are you paying interest on your "borrowings" or the house price itself? - whichever will be at compound interest rates, and no doubt the banks will argue for the latter, - "young families need housing, let's sell them yours", or whatever might seem to justfy stealing your house from you at the time, remember you are dealing with people who are only elected for 3 years then want to be re-elected again, you can't expect them to believe in being "fair".
    Now is the time to tell them the water is cold, not when Centrelink is knocking at your door with an eviction notice and offers of 'counselling' !!
    Boof
    4th Sep 2016
    4:26pm
    Lookfar. I agree with everything U say albeit, long winded. Wouldn't it be nice to see a liberal, big L, do something for aged pensioners, for a change. I've been advicating for a long time, that the aged pension should be seperate from all other pensions. (Bit like DVA pension. ie not linked. Aged people, I've found out, sometimes can't work or walk or run up hills. Even tho they'd like to be able.). Governments give pensions to people, living overseas as expats. After spending 10 years in Oz, who are living in luxury & spending their pensions over there. H'm. Perhaps we should send them, more aid $$$ s.
    Lookfar
    4th Sep 2016
    6:21pm
    Boof, sorry to be long winded, but some respondents seem to have thought it was an invitation for them to explain ordinary interest info, whereas the real guts of it is Gwenda informing us of the Compound Interest component, never mentioned by the smarmy talking heads.
    With overseas pensions, one should recall that many people that live in Australia have overseas pensions from their country of origin, perhaps with those countries things should be let lie, other countries do not have pensions, let alone overseas pensions, so the balance of payments goes that way a bit, - but compared with the balance of payments loss by buying defence equipment overseas, it is a very small drop in a very large ocean, - however that is another topic
    Cheers.

    21st Jul 2019
    8:16pm
    There are situations when you just think about hiring a hacker but you just hesitate to contact a hacker because of multiple reasons. Feel free to get in touch with us and maybe we might offer you the exact service you are looking for. Here are a few of most widely used hacker for hire services. www.y3llowl4bs.com or report a case via email to y3llowl4bs@protonmail.com

    Lost E-Mail Password Retrieval****Monitoring Services for Smartphones (iPhone and Android)***Track Live GPS Location***Cheating Partner / Cheating Spouse Monitoring***Social Messaging apps WhatsApp, iMessages, SMS, iCloud***Lost Social Media Password Retrieval***Facebook, Instagram & Snapchat Related Services***Cryptocurrency Fraud Investigation