Changes in Lending Policies: What Borrowers Need to Know
Christian Stevens, Mortgage Broker
Published January 31, 2025, 2:10 p.m ET
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🔑 Key Facts
- Australian lending policies shift regularly in response to economic, regulatory, and market conditions.
- Changes affect how much you can borrow, who qualifies for a loan, and what documentation is required.
- Policy updates often follow APRA or RBA guidance, particularly around serviceability and loan-to-value ratios.
- Staying informed helps you prepare your application and avoid surprises.
- Flint helps navigate lending changes and matches you with lenders that suit your situation.
Why Do Lending Policies Change?
Lenders update their policies to:
- Comply with regulatory guidance (e.g. APRA serviceability buffers)
- Respond to economic shifts (e.g. rising interest rates, inflation)
- Adjust risk exposure based on internal targets
- Remain competitive in different borrower segments
These changes help banks manage risk — but they impact borrowers differently depending on income, deposit size, and loan type.
Common Areas of Policy Change
🔄 Recent Trends Include:
- Serviceability buffer increases – many lenders assess loans at 3% above the actual rate
- Tighter DTI (Debt-to-Income) caps – some limit borrowing when DTI exceeds 6.0
- Stricter income verification for self-employed or casual workers
- Reduced LVR limits for higher-risk areas or property types (e.g. apartments)
- Policy easing for green or energy-efficient homes
ABS – Dwelling approvals, construction, finance data
Who Is Most Affected?
- First home buyers – may need more documentation or higher deposits
- Self-employed applicants – impacted by income verification tightening
- Investors – often face different serviceability and LVR treatment
- Refinancers – need to meet current (not original) lending standards
Flint can help identify which lenders are most favourable for your profile.
How to Respond to Lending Policy Changes
✅ Action Steps:
- Review borrowing power regularly, especially after major rate or policy changes
- Maintain clean, up-to-date finances – especially bank statements, payslips, and tax returns
- Explore multiple lenders – policy varies widely between banks and non-banks
- Refinancers – Use rising equity for better loan terms
Use a broker to adapt strategy quickly and access niche policies
Why It Matters for Pre-Approvals
If your pre-approval was issued more than 2–3 months ago, it may no longer reflect current lending conditions. A policy shift could reduce your borrowing power or alter loan terms.
Flint monitors these changes in real time to keep your loan strategy current.
📞 Need Clarity on a Recent Lending Policy Shift?
At Flint, we:
- Track lending policy updates from all major banks and lenders
- Proactively adjust your loan application to meet new criteria
- Offer access to lenders with flexible policies to suit your situation
Talk to Flint today and apply with confidence — no matter how policies move.
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