MELBOURNE MORTGAGE FINANCE LENDING UPDATE – July 2025
- Barry Le Brocq
- Jul 22
- 2 min read
Payout of Existing Debts
the vast majority of Reverse Mortgage applications involve paying out of existing debts which have high repayments
home loan balances, credit card balances and personal loan balances can all be paid out in one hit
no repayments are required on Reverse Mortgage loans, so clearing debts dramatically improves cash flow
this especially applies for retired borrowers who are still carrying heavy monthly repayment commitments
Drawdown of Loan: Options
once a loan Credit Limit has been approved, funds can be taken in three different ways:
cash drawdown: to clear existing debts or to provide cash for immediate needs
monthly income: to top up monthly Centrelink pension income
Cash Reserve: to provide cash for future needs (only advanced by the lender when cash is needed)
any combination of these funding options is permitted
Lender Does Not Become Co-owner of the Property
the lender’s security is a normal 1st mortgage over the security property
the lender does not become a co-owner of the property (this does occur with Bendigo Bank “Home Safe” product)
borrowers retain full ownership of the property and all future capital gain during the life of the loan
Applications Using Power(s) of Attorney
if elderly owners need Aged Care accommodation, a Reverse Mortgage can be arranged to fund this purpose
older borrowers often appoint an enduring Power(s) of Attorney to apply for the loan on their behalf
the POA agreement is initially vetted by lender solicitors to ensure that applying for a loan is permitted
once approved, the POA(s) complete the application and provide required normal supporting documents
settlement is then completed and future correspondence is directed to the POA(s)
Available Reverse Mortgage Loan Types and Interest Rates
8.60%: normal loan with no expected interest payments
8.10%: normal loan with half “interest only” monthly payments
7.60%: normal loan with full “interest only” monthly payments
8.10%: refinance loan with no expected “interest only” payments (Cash Reserve fund restricted to $25,000)
The Older You Are, the More You Can Borrow
minimum age for a loan is 60 / at age 60, maximum loan amount is 20% of property valuation
this increases by 1% for each year over 60 / at age 70, maximum loan is 30% of valuation
at age 90 or more, maximum loan is 50% of valuation e.g. for Aged Care admission
Call on 0437417042 or email barry@mmfinance.com.au to discuss individual scenarios.
Referral fee (15% of normal up-front commission) is available
Barry Le Brocq (B. Ec. / Dip. Fin. Services)
Melbourne Mortgage Finance (Reverse Mortgage Loan Specialist)
Mobile 0437417042
(Information is correct as at July 2025)
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