In February 2025, the Jim Chalmers announced reforms to home lending rules that will allow banks to responsibly disregard HELP (formerly HECS) debt when assessing mortgage applications. The change addresses a significant barrier for young Australians entering the housing market, with banks previously required to factor student loan debt into their lending assessments.

Under the new guidelines, financial regulators APRA and ASIC will update their guidance to banks, allowing them to exclude HELP debt from serviceability calculations if the borrower is expected to pay off their student debt in the near term. This practical reform means eligible borrowers could see their borrowing capacity increase significantly - for example, a borrower could see their borrowing power increase by $23,000 if their HELP debt is excluded from serviceability calculations.

[1] https://alp.org.au/news/commonsense-changes-to-help-more-australians-into-a-home/

[2] https://www.9news.com.au/national/hecs-debt-may-no-longer-affect-home-loans-jim-chalmers-to-announce-today/1711bd14-97c3-4721-ad4a-367612b0e1da

[3] https://www.abc.net.au/news/2025-02-11/banks-to-be-told-to-disregard-student-loans-in-mortgage-tests/104925006