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The Advertiser
15 hours ago
- Business
- The Advertiser
If you're going for a home loan but still have a HECS debt, you might want to wait
People with outstanding student loans will have an easier time getting a mortgage from September, when new lending rules will take effect. Banks will be able to disregard higher education loan program (HELP) debts, which include HECS debt, when assessing a homebuyer for a mortgage. The changes were finalised this week, after the Albanese government made a pre-election pledge in February to level the playing field for people with student debts. The Australian Prudential Regulation Authority has advised banks to remove HELP debt from debt-to-income reporting, a metric used to determine a person's capacity to repay a mortgage. The regulator has also clarified that it may be reasonable for banks to completely disregard a person's HELP debt from serviceability assessments, where it's expected the loan will be paid off within 12 months. Treasurer Jim Chalmers said the changes would make lending rules fairer. "We're making sure young people with a HELP debt are treated fairly and supporting them to get into the property market," he said. The changes mean a dual-income household with two student debts could borrow an additional $50,000 in the year they expect to pay off their student loan, according to the government's own analysis. APRA has written to lenders and the industry to advise them of the changes and their new obligations. The revised standards for banks will come into effect on September 30, 2025. In its letter to lenders, APRA said the changes would provide regulatory clarity and reaffirm the flexibility banks had in considering borrowers' individual circumstances. The regulator expects the changes will allow some borrowers with student debts to secure a home loan sooner. Education Minister Jason Clare said the Universities Accord found that banks' assessments of student debt made it harder for young Australians to buy a home. "HECS was never meant to be a handbrake on owning a home," he said. "That's not fair and we're fixing it." The federal government will also move ahead with its plan to reduce student debts by 20 per cent, something it committed to before the May election. During the election campaign, Prime Minister Anthony Albanese promised the legislative changes would be his first priority if his government was to be re-elected. The government has reaffirmed this, saying it will be the first piece of legislation introduced when Parliament returns on July 22, 2025. The 20 per cent reduction will occur once the legislation passes Parliament. However, the government has clarified the discount will be calculated based on a person's HELP debt amount as at June 1, 2025, before indexation was applied. This means the 2025 indexation will only apply to the remaining balance after the 20 per cent reduction. People with outstanding student loans will have an easier time getting a mortgage from September, when new lending rules will take effect. Banks will be able to disregard higher education loan program (HELP) debts, which include HECS debt, when assessing a homebuyer for a mortgage. The changes were finalised this week, after the Albanese government made a pre-election pledge in February to level the playing field for people with student debts. The Australian Prudential Regulation Authority has advised banks to remove HELP debt from debt-to-income reporting, a metric used to determine a person's capacity to repay a mortgage. The regulator has also clarified that it may be reasonable for banks to completely disregard a person's HELP debt from serviceability assessments, where it's expected the loan will be paid off within 12 months. Treasurer Jim Chalmers said the changes would make lending rules fairer. "We're making sure young people with a HELP debt are treated fairly and supporting them to get into the property market," he said. The changes mean a dual-income household with two student debts could borrow an additional $50,000 in the year they expect to pay off their student loan, according to the government's own analysis. APRA has written to lenders and the industry to advise them of the changes and their new obligations. The revised standards for banks will come into effect on September 30, 2025. In its letter to lenders, APRA said the changes would provide regulatory clarity and reaffirm the flexibility banks had in considering borrowers' individual circumstances. The regulator expects the changes will allow some borrowers with student debts to secure a home loan sooner. Education Minister Jason Clare said the Universities Accord found that banks' assessments of student debt made it harder for young Australians to buy a home. "HECS was never meant to be a handbrake on owning a home," he said. "That's not fair and we're fixing it." The federal government will also move ahead with its plan to reduce student debts by 20 per cent, something it committed to before the May election. During the election campaign, Prime Minister Anthony Albanese promised the legislative changes would be his first priority if his government was to be re-elected. The government has reaffirmed this, saying it will be the first piece of legislation introduced when Parliament returns on July 22, 2025. The 20 per cent reduction will occur once the legislation passes Parliament. However, the government has clarified the discount will be calculated based on a person's HELP debt amount as at June 1, 2025, before indexation was applied. This means the 2025 indexation will only apply to the remaining balance after the 20 per cent reduction. People with outstanding student loans will have an easier time getting a mortgage from September, when new lending rules will take effect. Banks will be able to disregard higher education loan program (HELP) debts, which include HECS debt, when assessing a homebuyer for a mortgage. The changes were finalised this week, after the Albanese government made a pre-election pledge in February to level the playing field for people with student debts. The Australian Prudential Regulation Authority has advised banks to remove HELP debt from debt-to-income reporting, a metric used to determine a person's capacity to repay a mortgage. The regulator has also clarified that it may be reasonable for banks to completely disregard a person's HELP debt from serviceability assessments, where it's expected the loan will be paid off within 12 months. Treasurer Jim Chalmers said the changes would make lending rules fairer. "We're making sure young people with a HELP debt are treated fairly and supporting them to get into the property market," he said. The changes mean a dual-income household with two student debts could borrow an additional $50,000 in the year they expect to pay off their student loan, according to the government's own analysis. APRA has written to lenders and the industry to advise them of the changes and their new obligations. The revised standards for banks will come into effect on September 30, 2025. In its letter to lenders, APRA said the changes would provide regulatory clarity and reaffirm the flexibility banks had in considering borrowers' individual circumstances. The regulator expects the changes will allow some borrowers with student debts to secure a home loan sooner. Education Minister Jason Clare said the Universities Accord found that banks' assessments of student debt made it harder for young Australians to buy a home. "HECS was never meant to be a handbrake on owning a home," he said. "That's not fair and we're fixing it." The federal government will also move ahead with its plan to reduce student debts by 20 per cent, something it committed to before the May election. During the election campaign, Prime Minister Anthony Albanese promised the legislative changes would be his first priority if his government was to be re-elected. The government has reaffirmed this, saying it will be the first piece of legislation introduced when Parliament returns on July 22, 2025. The 20 per cent reduction will occur once the legislation passes Parliament. However, the government has clarified the discount will be calculated based on a person's HELP debt amount as at June 1, 2025, before indexation was applied. This means the 2025 indexation will only apply to the remaining balance after the 20 per cent reduction. People with outstanding student loans will have an easier time getting a mortgage from September, when new lending rules will take effect. Banks will be able to disregard higher education loan program (HELP) debts, which include HECS debt, when assessing a homebuyer for a mortgage. The changes were finalised this week, after the Albanese government made a pre-election pledge in February to level the playing field for people with student debts. The Australian Prudential Regulation Authority has advised banks to remove HELP debt from debt-to-income reporting, a metric used to determine a person's capacity to repay a mortgage. The regulator has also clarified that it may be reasonable for banks to completely disregard a person's HELP debt from serviceability assessments, where it's expected the loan will be paid off within 12 months. Treasurer Jim Chalmers said the changes would make lending rules fairer. "We're making sure young people with a HELP debt are treated fairly and supporting them to get into the property market," he said. The changes mean a dual-income household with two student debts could borrow an additional $50,000 in the year they expect to pay off their student loan, according to the government's own analysis. APRA has written to lenders and the industry to advise them of the changes and their new obligations. The revised standards for banks will come into effect on September 30, 2025. In its letter to lenders, APRA said the changes would provide regulatory clarity and reaffirm the flexibility banks had in considering borrowers' individual circumstances. The regulator expects the changes will allow some borrowers with student debts to secure a home loan sooner. Education Minister Jason Clare said the Universities Accord found that banks' assessments of student debt made it harder for young Australians to buy a home. "HECS was never meant to be a handbrake on owning a home," he said. "That's not fair and we're fixing it." The federal government will also move ahead with its plan to reduce student debts by 20 per cent, something it committed to before the May election. During the election campaign, Prime Minister Anthony Albanese promised the legislative changes would be his first priority if his government was to be re-elected. The government has reaffirmed this, saying it will be the first piece of legislation introduced when Parliament returns on July 22, 2025. The 20 per cent reduction will occur once the legislation passes Parliament. However, the government has clarified the discount will be calculated based on a person's HELP debt amount as at June 1, 2025, before indexation was applied. This means the 2025 indexation will only apply to the remaining balance after the 20 per cent reduction.
West Australian
a day ago
- Business
- West Australian
‘Crocodile tears': Home loan change could add to worsening housing crisis
It's now easier for Australians to buy a home, but a key change to credit limits could push up the price of housing, a leading economist warns. The Australian Prudential Regulation Authority (APRA) announced on Thursday that Higher Education Loan Program (HELP) debts would be excluded from the credit limit for prospective homebuyers from September 30. Independent economist Saul Eslake told NewsWire that the change's two most obvious effects would be to 'allow some people who'd buy a home anyway to buy a more expensive one and (to) allow some people who wouldn't have been able to buy a home because of their student debt' to do so'. 'The net effect of those two factors will be to increase the demand for housing,' he said. 'The likely result is that it will, along with other things that governments are doing, put further upward pressure on the prices of property.' Mr Eslake said the change meant some people would be able to enter the housing market more quickly than otherwise but 'it would come at the expense of others'. 'The primary beneficiaries of this change will be those who will already own property will be able to sell it to people at higher prices than otherwise,' he said. 'That's consistent with the 60 years of evidence that we have, going back to the first homeowners grant scheme introduced by the Menzies government in 1964 that tells us that anything that allows Australians to pay more for housing than they'd be able to otherwise results in more expensive housing and a smaller proportion of the population owning it.' Mr Eslake added it was 'obvious' the money saved on HELP debt cuts would now be going towards a more expensive house. 'The reason that governments keep doing these things despite the evidence and despite all of the crocodile tears they routinely share about the difficulties faced by would-be first-home buyers is because they know that there actually aren't very many of them,' Mr Eslake said. 'On average, 110,000 a year, whereas there are 11 million people who own their own home. There are 2¼ million who own at least one investment property. That's an awfully much bigger number of votes for policies that keep house prices going up than there are for policies that might restrain the rate at which house prices keep going up.' Mr Eslake said the reason the housing crisis continued to worsen was 'because a majority of the population do not want it to be solved and politicians know that'. 'Until enough people my age, either out of an altruistic concern for the ability of their children and grandchildren to be able to do what they did, or perhaps more likely out of being pissed off at having to be the bank of mum and dad, until enough of them really want that to change, it isn't going to change.'
Perth Now
a day ago
- Business
- Perth Now
‘Crocodile tears': Warning over key change
It's now easier for Australians to buy a home, but a key change to credit limits could push up the price of housing, a leading economist warns. The Australian Prudential Regulation Authority (APRA) announced on Thursday that Higher Education Loan Program (HELP) debts would be excluded from the credit limit for prospective homebuyers from September 30. Independent economist Saul Eslake told NewsWire that the change's two most obvious effects would be to 'allow some people who'd buy a home anyway to buy a more expensive one and (to) allow some people who wouldn't have been able to buy a home because of their student debt' to do so'. It's now a little easier to buy a home. NewsWire/ Gaye Gerard Credit: News Corp Australia 'The net effect of those two factors will be to increase the demand for housing,' he said. 'The likely result is that it will, along with other things that governments are doing, put further upward pressure on the prices of property.' Mr Eslake said the change meant some people would be able to enter the housing market more quickly than otherwise but 'it would come at the expense of others'. 'The primary beneficiaries of this change will be those who will already own property will be able to sell it to people at higher prices than otherwise,' he said. 'That's consistent with the 60 years of evidence that we have, going back to the first homeowners grant scheme introduced by the Menzies government in 1964 that tells us that anything that allows Australians to pay more for housing than they'd be able to otherwise results in more expensive housing and a smaller proportion of the population owning it.' Mr Eslake added it was 'obvious' the money saved on HELP debt cuts would now be going towards a more expensive house. Independent economist Saul Eslake says the government cries 'crocodile tears' for first-home buyers while introducing measures that increase housing prices. Chris Kidd Credit: News Corp Australia 'The reason that governments keep doing these things despite the evidence and despite all of the crocodile tears they routinely share about the difficulties faced by would-be first-home buyers is because they know that there actually aren't very many of them,' Mr Eslake said. 'On average, 110,000 a year, whereas there are 11 million people who own their own home. There are 2¼ million who own at least one investment property. That's an awfully much bigger number of votes for policies that keep house prices going up than there are for policies that might restrain the rate at which house prices keep going up.' Mr Eslake said the reason the housing crisis continued to worsen was 'because a majority of the population do not want it to be solved and politicians know that'. 'Until enough people my age, either out of an altruistic concern for the ability of their children and grandchildren to be able to do what they did, or perhaps more likely out of being pissed off at having to be the bank of mum and dad, until enough of them really want that to change, it isn't going to change.'
Techday NZ
30-05-2025
- Business
- Techday NZ
Strengthening cyber resilience in superannuation
In early April, cybercriminals infiltrated multiple superannuation providers using stolen credentials to drain half a million dollars, while four Australians saw their retirement savings vanish overnight. Investigators are racing to piece together the scale of the breach, emphasizing the growing cybersecurity risks threatening Australia's AU$4.2 trillion retirement savings pool. With 12.6 million superannuation members exposed in recent attacks, the question is no longer if fraudsters will strike, but how the industry can stay ahead in this battle. Even though the Australian Prudential Regulation Authority (APRA) praised multifactor authentication (MFA) as "one of the most effective controls an organisation can implement" in 2023, the rapid evolution of cybercrime demands more sophisticated defences. Limits of MFA in a changing threat landscape MFA remains one of the critical security measures, requiring users to verify their identity with two or more credentials, which adds an extra layer of friction to deter attacks in the login process. However, cybercriminals are also adapting, using modern tactics such as phishing, social engineering and AI-powered techniques to bypass these defences. Recent superannuation breaches highlight another vulnerability in the digital landscape: inadequate password practices. Many individuals still reuse passwords across platforms, unintentionally simplifying the task for cybercriminals who exploit stolen credentials. Attackers often conduct these crimes unnoticed, causing considerable financial damage before they are detected. Trade-off between cybersecurity and user experience According to the True Cost of Fraud Study by LexisNexis Risk Solutions, Australian organisations saw a 66% year-on-year increase in fraud, with every dollar lost costing firms AUD$3.68. This trend highlights the urgency for a more adaptive and layered approach to fraud prevention. At the same time, customers today expect both security and convenience. Applying MFA to every interaction could be a more robust approach but excessive friction can lead to abandonment, indirectly discouraging users from monitoring their accounts due to higher friction, making them less likely to notice when they have become victims of an attack. A more nuanced, risk-based approach that applies the right level of security based on the context and risks of each interaction allows organisations to detect and disrupt complex fraud in real time without adding unnecessary friction. By aligning protection with risk, businesses can strengthen security without compromising customer experiences. A comprehensive defence strategy involves multiple layers, and each layer strengthens defence against fraudsters. This ensures that if one security measure fails, others remain in place to detect and mitigate fraudulent activity. Key measures should include identity verification, device intelligence, behavioural intelligence and real-time risk scoring: Risk assessments analyse contextual risk signals, such as device reputation, IP geolocation, network patterns and login behaviours. This allows institutions to assess the risk level of each interaction. AI models analyse these signals in real time to assign a risk score, deciding whether extra authentication is necessary. AI-powered identity verification ensures that the individual behind the digital interaction is genuine. Comparing identity details with public records and data from multiple providers further validates the authenticity of the identity. Fraud assessments assess risk associated with an individual's identity by analysing a combination of digital, physical and behavioural signals. With holistic behavioural intelligence, such as keystroke dynamics, device interactions and mouse movements, this approach builds a dynamic profile of each user over time, and deviations from this may signal potentially bot or fraudulent activities. Adaptive authentication: Apply stronger verification for high-risk scenarios dynamically, while maintaining a smooth experience for legitimate users. Recent cyberattacks targeting superannuation funds highlight the need for a more robust digital defence strategy. APRA's multi-factor authentication guidelines offer a solid foundation, but static approaches alone are not enough to manage dynamic threats. Industry players must take a unified, layered approach to safeguard Australia's financial system.
News.com.au
22-04-2025
- Business
- News.com.au
Housing affordability: How a change to mortgages could benefit buyers into the tune of $20k
Prospective first-home buyer Sharna Hackett jokes that having a bit more money in her kitty might allow her to purchase a residence with 'an actual kitchen bench'. In 2023, Ms Hackett moved back to Melbourne after securing her dream job as a video manager in the visual effects industry, following years of working overseas in the creative sector. Aged in her 40s, she is now hoping to buy a two-bedroom apartment not too far from her inner suburbs' workplace after spending 'quite a few years' saving up a deposit. Ms Hackett said that if mortgage serviceability buffers were cut – potentially expanding her home loan by tens of thousands of dollars – she might be able to buy in a pricier suburb than the ones she has been looking at, such as Fitzroy North or Westgarth. 'It might mean that I could be a little bit more open to things that are a little bit nicer or, you know, an actual kitchen bench,' she said. Ms Hackett doesn't see herself ever being able to afford a house unless she could flip an apartment for quite a bit more than she paid for it. New data analysed by property sales and research firm Oliver Hume shows there are more than 400 suburbs where the typical household's wage isn't enough to buy there. There are just 36 areas where the local wage would be enough to buy a house with, mostly in Melbourne's outer ring including Wyndham Vale, Mickleham and Cranbourne South. But a Senate Inquiry recommendation to change the rules around how banks lend us money could change the situation in dozens of suburbs — and boost first-home buyer budgets by more than $20,000. Oliver Hume's figures show that a 1 per cent reduction to the nation's 3 per cent serviceability buffer for home loans would be enough to put 60 Melbourne suburbs on the affordable list, based on local incomes. The buffer is set by the Australian Prudential Regulation Authority and used by banks to stress-test mortgages to ensure a buyer could cope if their interest rate was 3 percentage points higher — which saved many households from disaster as interest rates surged from 2022 to 2023. Melbourne-based Smart Lending director and senior loan writer Melissa Gielnik said that for every half a percentage point cut from mortgage serviceability buffers, about $20,000 would be returned to a home loan – but this would vary based on factors like home prices. Ms Gielnik said that she would like to see Australia's mortgage serviceability buffer reduced to a 2 per cent figure. 'Especially because (interest) rates are on decreasing, we've ridden the wave of the up, now we're coming down,' she said. 'So being on the downward slide, I kind of feel like they could lessen it.' And Ms Hackett said that if mortgage serviceability thresholds were decreased, a new deluge of buyers would likely enter the market. 'My only concern would be, what tends to happen when things become more affordable is prices seem to go up because more people are looking at the same stock,' Ms Hackett said. 'I'm not necessarily sure that it would make a significant difference, because then I would just be competing with more people.' Buyer's agency Cohen Handler Victoria's business director Zac Jacobs said that for some people, cutting the mortgage serviceability buffer would allow them to look at properties and suburbs they wouldn't otherwise consider due to financial constraints. 'I guess our fear always is, does that level the playing field for all first-time buyers and then negate it at the same time?' Mr Jacobs said. 'Because now they can afford by spend between $20,000 more, everyone can afford to spend $20,000 more, the prices go up $20,000. That's the issue I would say.' He added that the having an additional $10,000 to $20,000 could help cover a buyer's advocate's fees too. 'It could help them (a buyer) engage someone professional to help them find the right property, negotiate the property off market, for example, so don't have to compete at auction,' he said.
