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Macquarie Bank has targeted retirees by releasing a reverse mortgage and an accommodation bond loan.
Both products have a maximum LVR of 45 per cent and are available to customers aged at least 70.
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Loans are secured with a mortgage over the equity in the customer’s home. They can be taken as a lump sum, a regular monthly payment or a combination of the two.
Macquarie said customers would be protected from owing more than their home was worth through a no-negative-equity guarantee.
The reverse mortgage is designed to help customers cover general living costs and pay for one-off items such as medical bills and travel.
Interest is debited to the customer’s loan account, with payment deferred until the property is sold and all borrowers have left the home or are deceased.
The accommodation bond loan allows retirees to fund the bond required for aged-care facilities.
Interest is charged and is capitalised into the loan. No repayments are required until the end of the loan, although additional and partial repayments are permitted at any time.
All reverse mortgage and accommodation bond borrowers will have to provide evidence of financial and legal advice.
