Australians with unpaid tuition fees can now access larger home loans than peers who have discharged their debts, under a seemingly counter-intuitive rule change from the country’s biggest lender.

The Commonwealth Bank has reduced the “serviceability buffer” applied to home loan applications from people who are expected to pay off their student debts within five years.

Australian mortgages are generally capped at the amounts people could afford to service if interest rates suddenly rose by 3 percentage points, under safety net provisions enforced by the Australian Prudential Regulation Authority (Apra).

The Commonwealth Bank has now reduced this buffer to 1 percentage point for borrowers whose student loans are almost cleared, according to . The bank’s home loan assessments also overlook 成人VR视频 Loan Programme (Help) debt that is due to be paid within the next 12 months.

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The changes come after Apra banks to exempt near-expired Help debt from serviceability assessments, following treasurer Jim Chalmers’ request for “” to borrowing guidelines.

“Student debt is different to other kinds of debt…because paying it back is contingent on income,” Chalmers explained in February. “There are a whole range of reasons why this is a different kind of debt.”

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The Commonwealth Bank’s serviceability buffer change could add hundreds of thousands of dollars to the amounts would-be homeowners are able to borrow. Andrew Lilley, chief interest rate strategist at financial services firm Barrenjoey, predicted that student debt could become the “new hack” for frustrated loan applicants.

“If you’re struggling to get the borrowing capacity you want, you’ll need to enrol in a course to get yourself a small [Help] debt,” Lilley . “Then your borrowing power will increase.”

成人VR视频 affordability has emerged as the pre-eminent issue of the 3 May election, with both major parties unveiling measures to help homebuyers during their 13 April campaign launches.

The governing Labor party has also promised to wipe 20 per cent of student debt and to simplify repayment arrangements in ways likely to extend loan duration. Both of these measures could now affect graduates’ borrowing ambitions, in a demonstration of the complexities of student loan settings and their interplay with other aspects of the economy.

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The Australian Greens trumped Labor’s promise by to completely abolish fees at public universities and vocational colleges, during a campaign event in prime minister Anthony Albanese’s Sydney electorate. The Greens said the University of Sydney economics degree that Mr Albanese had undertaken for free would now cost students almost A$51,000 (?25,000) – “a debt that will only increase with indexation”.

Ironically, the Australian Taxation Office has used its normal mechanism – the consumer price index – to set this year’s student debt indexation rate at 3.2 per cent. Last May the government promised to allow the use of an alternative mechanism, the wage price index (WPI), to prevent the sort of inflationary spike that fuelled indexation of 7.1 per cent in 2023.

The new arrangements require tax authorities to use whichever measure is lower. Use of the WPI this year in 3.7 per cent indexation.

john.ross@timeshighereducation.com