You can still get an investment loan close to retirement, but when the loan term runs past the age you expect to stop working, most lenders will ask how the debt will be repaid after your income ends. That plan is called an exit strategy, and preparing it before you apply often matters as much as your income.
On episode 113 of the podcast, long-term clients Sean and Nicole share how they built a portfolio with Sean approaching retirement after 29 years in Defence. This article covers the lending question behind that kind of plan: what a lender looks at when the working years ahead are fewer than the loan term.
When do most Australians expect to retire?
According to the ABS, the average age people aged 45 years and over intend to retire is 65.6 years, while those aged 45 and over who retired in 2024-25 did so at an average age of 63.8 years (ABS, Retirement and Retirement Intentions, Australia, 2024-25).
Set that against a standard 30-year loan term and the issue is plain. A borrower in their mid-50s taking a 30-year loan would be well into their 80s at the end of the term. A lender has to be satisfied the loan can be repaid without substantial hardship, so it will want to know what happens in between.
What does a lender look at when you are closer to retirement?
| Earlier in your career | Closer to retirement | |
|---|---|---|
| Income assessed | Current income, expected to continue | Current income, and how long it is likely to continue |
| Loan term | Often the full term available | May be shortened, or longer with an exit strategy |
| Exit strategy | Rarely asked for | Commonly required where the term runs past retirement |
| Repayment type | Interest only or principal and interest | More scrutiny of how and when principal is repaid |
| Rental income | Supports serviceability | Supports serviceability and may form part of the exit |
None of this is a fixed rule. Each lender sets its own policy, and the same borrower can receive quite different answers from two lenders.
What is an exit strategy?
An exit strategy is a credible explanation of how the loan will be reduced or repaid once your employment income stops. Lenders generally want it to be specific and realistic. Examples a lender may consider include:
- Selling an investment property. Repaying the debt from the sale of a nominated asset.
- Downsizing. Selling a larger home and clearing debt from the proceeds.
- Other assets. Savings or investments set aside to reduce the loan.
- Continuing income. Rental income or ongoing work that can carry the remaining debt.
What each lender accepts, and the evidence it asks for, varies. Whether any of these is right for you is a question for your accountant and, where it involves super or retirement income, a licensed financial adviser.
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Why does preparation matter more later in life?
Because there is less time to recover from a poorly structured loan. In the episode, Sean and Nicole were told they were not ready to buy. They spent more than two years preparing and restructuring debt, then made two purchases in less than 12 months. Their message was that quality assets mattered more than quantity.
Later in a working life, the sequence carries more weight. Which property comes first, which loans are paid down and which asset is the exit all shape what the portfolio looks like at retirement.
How should partners plan when their timelines differ?
Many couples retire at different times, or bring finances together after previous relationships, as Sean and Nicole describe. A lender will look at both incomes and both timelines. The ownership structure between partners also has tax and legal consequences, so it belongs in a conversation with your accountant and legal adviser before the contract is signed.
What should you prepare before applying?
- Your intended retirement age. Realistic and consistent across your application.
- A written exit strategy. Which asset or income repays the debt, and when.
- Your current position. Income, expenses, debts and credit limits, accurately stated.
- The structure. How the new loan sits beside existing loans, so one does not limit the next.
- Your advisers. Your accountant and finance strategist talking before you buy, not after.
Common questions
Can you get an investment loan close to retirement?
Yes, age on its own does not rule out an investment loan. Where the loan term runs past the age you expect to stop working, most lenders will ask for an exit strategy showing how the debt will be repaid once your employment income ends. Every application is subject to individual assessment and lender criteria.
What is an exit strategy for a loan?
An exit strategy is a realistic explanation of how a loan will be reduced or repaid after your working income stops, for example by selling a nominated investment property, downsizing or using other assets. What a lender accepts, and the evidence it requires, varies from lender to lender.
What age do Australians intend to retire?
According to the ABS Retirement and Retirement Intentions survey for 2024-25, people aged 45 years and over intend to retire at an average age of 65.6 years. Those aged 45 and over who retired in 2024-25 did so at an average age of 63.8 years.
Can I still get a 30-year loan in my 50s?
Some lenders may offer a longer term to an older borrower if a credible exit strategy is in place, while others may shorten the term, which raises the repayments. The answer depends on the lender, your income, your assets and how the debt will be repaid after you stop working.
The takeaway
Investing close to retirement is less about your age and more about your exit. A lender wants to see how the debt ends, not just how it starts.
Know your timeline. Write down the exit. Get the structure right before the purchase. If you want that mapped for your position, Book a Call.
This article is general information only. It does not take your individual circumstances into account and is not credit, tax, legal or financial product advice. All lending is subject to individual assessment and lender criteria. Speak with your own advisers before acting. Superannuation, retirement income and ownership structures are matters for a licensed financial adviser, your accountant and your legal adviser.