It wasn’t on their credit file.
When it came down to it, the reason this Inner West couple could not borrow what they needed was entirely different.
A bank had given them a number, and it fell well short of the street they had their hearts set on. Two steady PAYG incomes. No car loan. No credit cards. A clean savings history.
The gap was their HECS.
Here is what catches people out… a HELP debt does not appear on your credit report and it does not touch your credit score. But lenders treat the compulsory repayment coming out of your pay as a committed expense, much like a car repayment.
That repayment reduces the income available to service a mortgage, and because serviceability is tested at a buffer above the actual rate, a modest fortnightly deduction becomes a far larger cut to what you can borrow.
Since late 2025, APRA guidance has allowed lenders to leave HELP repayments out of serviceability by exception, where the borrower is expected to clear the balance within roughly twelve months.
But… lenders have responded unevenly. One major applies the carve-out when a borrower is inside a year of paying the debt off. Another excludes smaller balances with ATO documentation. Plenty have adopted nothing at all.
So the same couple can walk out of two banks with very different answers.
This couple was close. Not inside twelve months, but close enough that a modest voluntary repayment brought them into range, and we placed the file with a lender whose policy recognised it. The borrowing figure moved. The street stayed possible.
The lesson is not that everyone should rush to clear their HECS. Sometimes that money does more good in the deposit. It is that the number a bank hands you is a policy outcome, not a fact about you.
If you have a HELP debt and a purchase in mind, check where you sit before accepting the first figure.
My Mortgage Concierge is licensed under ACL 392736 Sattout Accounting Services Pty Ltd. General information only — seek personal advice before acting.
