Specialist retirement lender Household Capital has launched Household Transfer, a new drawdown loan facility to provide retirees with an income stream and a lump sum payment using the equity in their home.
Household Transfer could supplement retirees’ super and Aged Pension with the benefit of both, which Centrelink’s Pension Loan Scheme (PLS) is unable to do, with the option to receive income paid either fortnightly or monthly.
The drawdown facility was developed in response to demand from financial advisers who wanted clients to have a regular income stream in addition to receiving a lump sum payment.
Australia’s median household superannuation balance at retirement is $200,000, while the median home value at retirement is $700,000.
Joshua Funder, Household Capital chief executive, said the firm was committed to providing funding solutions for retirees who find their savings locked up in property assets.
“We find most people looking for a regular drawdown also take a lump sum for a specific purpose, such as renovations, a new car, medical expenses or to provide financial support to children and other family members,” Funder said.
“There are various expenses which can arise in retirement so we have developed a flexible funding solution which can be tailored for these individual requirements whatever they may be.”