Heartland Seniors Finance Reverse Mortgage
Heartland Seniors Finance is the winner of our 2018 Award for Provider of the Year – Reverse Mortgages. Heartland also received the award in 2017 and our 5-star rating for outstanding value in 2016. Read on to find out why Heartland is this year’s award winner.
Reverse mortgage products from Heartland Seniors Finance
Heartland’s reverse mortgage was the market-leading product for features. The loan has no ongoing fees and Heartland Seniors Finance was the only institution that offered protected equity (up to 50% of home value) and committed funding options (including lump sum funding and future funding guarantees). They offered potential customers an eight-hour approval turnaround – beating the average turnaround of 25 hours. Heartland also allowed a non-titled person (i.e. a partner who is not the lead person named in the loan) to remain living in the property even if the titled person has passed away.
A unique feature among the products rated in the 2018 Reverse Mortgages Award was the Heartland Seniors Finance equity protection option, where you could choose to protect a percentage of the eventual net sale proceeds of your home. This feature allows customers to ensure that when their loan is repaid, they (or their estate) are guaranteed to receive any chosen Equity Protection percentage.
Heartland Seniors Finance makes three promises to its customers:
- Lifetime Occupancy: Your home will remain the place you live in for as long as you choose.
- No Negative Equity Guarantee: The amount required to repay the loan will never exceed the sale proceeds of the property.
- Loan Repayment: There is no requirement to make any loan repayment until the end of the loan.
Source: Heartland Seniors Finance
Heartland Seniors Finance began as Australian Seniors Finance (ASF), and was founded in 2004 in Victoria. They were a founding member of the Senior Australians Equity Release Association of Lenders (SEQUAL) and played a significant role in developing Australia’s laws to protect home equity and its reverse mortgage market.
ASF changed name to Heartland when they were bought out by Heartland Bank in 2014. At the time of the purchase, Australian Seniors Finance was known as the largest non-bank lender in the Australian market.
Heartland Bank is one of New Zealand’s oldest financial organisations, having been founded in 1875 as CBS Canterbury through the amalgamation of three large building societies. Heartland officially became a bank in 2013 and is still proudly New Zealand owned and operated today.
Heartland Seniors Finance today are the only Australian member of the world’s biggest reverse mortgage industry body, National Reverse Mortgage Lenders Association (NRMLA).
Heartland Bank recently began efforts to support the community and protect the environment through a new specialisation in agricultural lending beginning in 2015.
Source: Heartland Seniors Fina
Q: Overall, we are seeing fewer reverse mortgages being offered in the market, why is that the case?
At Heartland Seniors Finance, we are seeing record levels of enquiry and volumes. [We] think this is driven by a number of factors including an ageing population, higher property values, lower interest rates and increasing indebtedness, albeit with greater equity.
Q: How can a reverse mortgage improve your retirement cash-flow?
Heartland offers flexible draw down options including a lump sum, a cash reserve facility, and a regular advance.
With a regular advance, customers can set monthly, quarterly or annual payments, over 5 or 10 years, to help them live a better retirement. The amounts are often modest, but the impact can be transformational.
Q: Can I take out a reverse mortgage and rent part or my entire home?
Our standard reverse mortgage is designed for seniors who wish to stay in their own home. Customers can take in a tenant and in certain situations rent the property out, although generally only short-term.
We do offer an Aged Care option, for customers in aged care, which does allow the property to be rented out, and we do have an Investment Property option.
Q: What is the main reason your customers take out a reverse mortgage?
There are a variety of purposes, with the main ones being home renovations, travel, upgrading a motor vehicle, aged care and medical costs, day to day living expenses, and repaying debt such as [an] existing mortgage.
Repaying an existing mortgage is becoming more common as this allows our customers to retire properly, without the burden of ongoing payments.
Q: What should people be looking out for when considering a reverse mortgage?
It is very important that people make an informed decision and deal with a provider who will assist them with this.
[We] believe that flexibility is critical; circumstances can change for seniors at any time and they therefore need the ability to repay at any time, in full or in part, without penalty. Flexibility should extend to draw down options and overall criteria to ensure they can benefit from the loan and have peace of mind.
Then there is the consumer protection. Heartland offers lifetime occupancy, so you can stay in your home as long as you choose; a no negative equity guarantee, so you will never owe us more than the net sale proceeds of your home; and a no repayment promise, so that you will never have to make a repayment until you leave the property (but you are free to do so at any time).
Last but not least, deal with a company that provides excellent service. Having a Canstar Provider of the Year Award is a pretty good indication!
Source: Heartland Seniors Finance
Showing products in Canstar’s database with links to lenders’ websites. The display is sorted by the advertised interest rate (lowest to highest), then provider name (alphabetically).
Source: Canstar. Based on residential variable home loans available for a loan amount of $350,000 at 80% LVR, and available for Principal and Interest repayments.
*Comparison rate based on loan amount of $150,000. Read the Comparison Rate Warning.