The Truth about Pension Loans in Australia

Pension LoansExperiencing income drawdown after shifting from working to being a pensioner usually limits you when it comes to your expenses and investments. If you want to have a business using your pension, travel and visit your relatives, or have other plans with your limited monetary benefits, you can get financial assistance through short-term and long-term loan for pensioners.

In Australia, the Department of Human Services, banks, and online credit licensees are offering pension loans to help pensioners maximise their benefits. Pension loan schemes vary on the benefits that pensioners are receiving. The loan eligibility depends on the institution that you will be transacting with.

Interest rates of the loan will also be based on various factors. Some institutions are giving low interest rates because they consider the financial status of the pensioners. Here are some factors that lending institutions usually assess:

  1. Amount of pension the borrower is receiving
  2. Credit rating and record of the borrower
  3. Choice of loan terms (short-term or long-term)
  4. Asset value of the borrower

It is better to apply for a short-term loan if you are a beneficiary of pension plans to guarantee the financial institution that you can repay your debt. Australia’s small loan options for pensioners, however, can only be paid from one to six months.

If you are home based and cannot go to banks, or you just want to avoid the stress and fuss of undergoing the long process of applying for loans, you can get the services of online credit licensees. There are banks that provide online alternative for loan applications.

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Pensioners can maximise their benefits through various ways, including pension loan schemes. Talk to a lender to determine if this financing option suits your situation.