Mortgage brokers are hailing the move by Commonwealth Bank of Australia not to count HECS bills as debt in home loan assessments if they are due for repayment within a year.
CBA said it is also “piloting” dropping the serviceability buffer to 1%, from its current 3%, for those due to pay off their student debt within five years.
The serviceability buffer is set by regulator Australian Prudential Regulation Authority (APRA), requiring banks to assess home loan applications at an interest rate three percentage points higher than the current rate.
The move by Australia’s biggest home lender is expected to see thousands more young people instantly qualify for home loans.
CBA’s executive manager of home buying Michael Baumann said CommBank…
