Preparing financially
How a HELP/HECS debt affects your home loan
How the repayment (not just the balance) affects serviceability, when lenders can exclude near-finished HELP debt, and whether paying it down before applying actually helps.
- Your compulsory HELP repayment ordinarily affects serviceability, even though the balance itself is excluded from APRA's regulatory debt-to-income reporting definition.
- Lenders may exclude HELP repayments where the debt is expected to clear within about 12 months — but this is lender discretion, not an automatic rule.
- Repayment income can include more than salary — fringe benefits, investment losses and super contributions can all count.
- A partial voluntary repayment may not change serviceability if the compulsory repayment continues — ask your lender to model the effect before paying.
The repayment, the balance, and DTI reporting aren't the same question
Your compulsory repayment ordinarily affects a lender's serviceability assessment, since it reduces the income available for mortgage repayments. Separately, APRA's regulatory debt-to-income reporting definition excludes HELP debt, because repayments are income-contingent rather than a fixed obligation — but that's a reporting definition, not an instruction that lenders must ignore your repayment when assessing what you can actually afford. Don't assume either "it always counts against me" or "it's excluded from everything" — both are too absolute.
When can a lender exclude HELP repayments?
APRA has indicated it's reasonable for a lender to exclude HELP repayments from serviceability where your debt is expected to be fully repaid within about 12 months through compulsory repayments — on the basis that you'd be largely unaffected by it over the rest of the mortgage term. This is lender discretion under their own credit policy, not an automatic entitlement — some lenders apply it, others may not, so ask directly rather than assuming it applies to you.
Compulsory repayment thresholds
For the 2026-27 income year, compulsory HELP repayments are nil for repayment income of $69,528 or less (Australian Taxation Office, verified 31 Jul 2026); above that, a marginal repayment system applies rather than a flat percentage of total income: 15 cents for each dollar from $69,529 to $129,717, $9,028 plus 17 cents for each dollar from $129,718 to $186,050, and 10% of total repayment income above $186,051. "Repayment income" can include more than salary — reportable fringe benefits, net investment losses and reportable super contributions can all be included, so income you don't think of as "salary" can still affect your repayment. Thresholds and rates are indexed and published by the ATO each financial year.
Should you pay down your HELP debt before applying?
Not automatically. A partial voluntary repayment may not meaningfully change your serviceability if the compulsory repayment continues regardless — you've reduced the balance but not the income-tested repayment itself. Fully clearing a genuinely small balance may help, but only where your lender can actually verify the repayment obligation is ending. Weigh any possible borrowing-capacity benefit against giving up cash you might need for your deposit or a genuine reserve — ask your lender to model the effect before paying, rather than assuming it will help.
Practical checklist
Before applying with a HELP debt
- Check your current HELP balance via the ATO or myGov
- Check your income against the current compulsory-repayment threshold
- Ask your lender whether they apply a near-repayment exclusion policy
- Disclose the debt to your lender or broker upfront
- Ask your lender to model any voluntary-repayment effect before making one
Questions for a professional
- How exactly does my HELP debt affect the amount you'll lend me?
- Do you apply a near-repayment exclusion, and would my debt qualify?
- Would paying down my HELP debt before applying actually change my borrowing capacity?
Official resources
Sources and methodology
- Study and training loan repayment thresholds and rates — Australian Taxation Office (retrieved 31 Jul 2026)
Figures on this page are drawn from Delora's local knowledge graph, refreshed from these primary sources and checked for changes on a regular schedule. If a figure here looks out of date, the official source above is always the authority — please let us know.