Hunter financial institution Greater Building Society has moved into the reverse mortgage market of one of the fastest growing loan products in Australia.

Greater assistant general manager Don Magin said the move was in partnership with home equity release specialists Australian Seniors Finance. Popular with "baby boomers" reverse mortgages allow home owners aged 60 and over to borrow cash against the value of their home. Mr. Magin said the loan can turn bricks and mortar into a cash resource to fund the lifestyle people would like to live. He said people were using the loans to pay for things such as renovations and health care.

Mr. Magin said people aged 60 years or more, or couples with one person over 60 and the other over 55 who own their own home may borrow a percentage of the value of their home. The percentage increases as people get older. Unlike standard loans, reverse mortgages did not require regular repayments of either interest or capital gains during the course of the loan.

The loan is repaid when the borrower decides to sell their home or on the death of the last surviving partner.

Article by Business Editor, Greg Wendt, 'Spending the kids' inheritance made even easier', taken from the Newcastle Herald, 15 September 2006, p 27

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