‘Help! I’m a pensioner with no savings and I don’t want to rent any more’

Q: I retired from the workforce about three years ago and I am on an Age Pension now. I am 66 years old and got married in 2014. I don’t have any savings or superannuation because I cashed in my super about three years ago due to a disability and got a total of $10,000. I don’t have much of anything because of previous relationships. And my wife came out of her previous marriage with nothing but some furniture. I still have one 16-year-old child that I pay maintenance for.

My wife is still working on a part-time basis, but because she works I get penalised on my pension. We rent and my employment benefits pays for the rent but I was wondering how can we get into the housing market with our pension because we’re currently paying about $255 a week and are worried about the rent going up.

No one will give us a mortgage but I thought there might be someone out there that can help us even just to live somewhere; they can keep the title but we can live there for the rest of our lives without the rental going up. Can you help?

A: I am afraid I don’t have a good answer to your question. As you are now 66 and on a part-Age Pension and you wife is working part-time, it is unlikely you would have enough cashflow to support a mortgage even by using the rent you now pay. The other problem will be having a reasonable deposit. It sounds like you don’t have a lot of savings or super left. The deposit needed by a bank increases as you get older.

Also, at age 66 they will not lend you money for the normal 25 years without an exit strategy if case you die before the loan is paid out. Normally the banks like to see you with some other assets like super which could clear the loan if you passed away.

Additionally, the new credit rules applying to lenders make it almost impossible for banks and other institutions to lend to people in your circumstances even if they wanted to. I am not sure where to look for someone who would allow you to live in a residence for the rest of your lives without rental increases. I’m sorry I can’t help you much with your question, but there maybe someone with more expertise in this area who can.

For example, the Housing for the Aged Action Group may have helpful advice and will be able to direct you to resources in your state or territory (for example, applications for social housing are all state and territory-based). Centrelink also has information on where you can access support if you experience a cash crunch and struggle to pay your rent.

If you have a question for Starts at 60’s money experts, email it to [email protected].