From HELP Debt to Home Keys: The Policy Change Opening Doors
There’s good news for young Australians with HELP debt (formerly HECS) hoping to enter the property market. Recent changes by the Commonwealth Bank of Australia (CBA) are making it easier to secure a home loan, giving buyers with student debt the chance to fast-track their journey into a brand-new home.
How the changes work
CBA has updated its loan assessment process so borrowers whose HELP debt will be fully repaid within 12 months can have it excluded from their home loan assessment.
In addition, the bank is reducing the serviceability buffer from 3% to 1% for borrowers whose HELP debt will be cleared within five years.
In practical terms, this could mean a meaningful boost to how much buyers can borrow, helping them move into a new home sooner, with more options for floorplans, facades, and features.
Why it matters
For years, HELP debt has reduced the borrowing power of young Australians, making it harder to secure a loan. With these changes, borrowers with stable incomes and HELP balances nearing the end of repayment could see their borrowing capacity rise by tens of thousands of dollars—a game-changer for entering the property market.
For example, a couple on a combined income of $140,000 with HELP debt ending within 12 months may borrow around $36,000 more. At the higher end, a couple earning $240,000 combined might increase their borrowing capacity by up to $187,000, making that dream home with Carlisle far more achievable.
Policy changes to support first-home buyers.
Why now?
These updates follow broader efforts by government and regulators to improve housing access. The Federal Government has been pushing for ways to help first-home buyers, supported by proposed changes from the Australian Prudential Regulation Authority (APRA) and recent ASIC guidance encouraging more flexible lending practices.
It’s hoped CBA’s move will prompt other banks and institutions to review their policies, creating more competition and improving lending conditions for eager buyers.
Your path to a new home starts here
With the lending landscape changing, there’s never been a better time to explore your homeownership options. Carlisle Homes offers a stunning range of affordable, thoughtfully designed homes perfect for first-home buyers and growing families.
To understand how these updates could help your borrowing power, speak with Carlisle’s in-house finance partner, Mortgage Domayne. They can help assess your situation and guide you toward securing your new Carlisle home sooner.