𝗧𝗵𝗲 𝗿𝘂𝗹𝗲𝘀 𝗮𝗿𝗲 𝘀𝗵𝗶𝗳𝘁𝗶𝗻𝗴 – here’s how to get an edge

From 1 October 2025, a few big levers move in Australia’s credit market. First-home buyers get easier access via a turbo-charged Home Guarantee Scheme.

Regulators keep lending tests tight. Rates have started to fall – and banks are passing cuts on. If you’re planning a home, personal or business loan, these settings will shape how much you can borrow, what you’ll pay, and how fast you can move

(𝗾𝘂𝗶𝗰𝗸 𝘀𝘂𝗺𝗺𝗮𝗿𝘆)

𝗙𝗶𝗿𝘀𝘁 𝗛𝗼𝗺𝗲 𝗚𝘂𝗮𝗿𝗮𝗻𝘁𝗲𝗲 (𝗛𝗚𝗦) 𝗲𝘅𝗽𝗮𝗻𝗱𝘀 𝗼𝗻 𝟭 𝗢𝗰𝘁:

Unlimited places, no income caps, and higher price caps (e.g., Sydney up to $1.5m; Perth up to $850k). Buyers can still purchase with as little as 5% deposit without LMI.

𝗟𝗲𝗻𝗱𝗶𝗻𝗴 𝗿𝘂𝗹𝗲𝘀 𝘀𝘁𝗮𝘆 𝘀𝘁𝗿𝗶𝗰𝘁: APRA keeps the 3% serviceability buffer (banks must assess you at a rate 3% higher than your actual loan).
APRA

𝗥𝗮𝘁𝗲𝘀 𝗮𝗿𝗲 𝗲𝗮𝘀𝗶𝗻𝗴: The RBA cash rate is 3.60% after the August cut; majors (e.g., CBA) passed through -0.25% to variable mortgage customers.

𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝗹 𝗰𝗿𝗲𝗱𝗶𝘁: BNPL now falls under credit law (from 10 June 2025) – expect more checks and protections.

𝗪𝗵𝗮𝘁’𝘀 𝗮𝗰𝘁𝘂𝗮𝗹𝗹𝘆 𝗰𝗵𝗮𝗻𝗴𝗶𝗻𝗴 𝗼𝗻 𝟭 𝗢𝗰𝘁𝗼𝗯𝗲𝗿?

1) Home Guarantee Scheme gets a big upgrade

From 1 October 2025, the Government removes annual place caps, scraps income caps, and lifts property price caps under the Home Guarantee Scheme.

That means more buyers can purchase with 5% down (or 2% for eligible single parents) and no LMI—as long as the property sits under the new caps.

New headline price caps (examples):

• Sydney: up to $1.5m
• Melbourne: up to $950k
• Brisbane/Canberra: up to $1.0m
• Adelaide: up to $900k
• Perth: up to $850k
• Hobart: up to $700k

𝟮) 𝗟𝗲𝗻𝗱𝗶𝗻𝗴 𝗰𝗿𝗶𝘁𝗲𝗿𝗶𝗮: 𝘁𝗵𝗲 𝟯% 𝗯𝘂𝗳𝗳𝗲𝗿 𝘀𝘁𝗮𝘆𝘀

APRA reviewed the macro-prudential settings in July and kept the serviceability buffer at 3% and the countercyclical capital buffer at 1%. Translation: borrowing tests remain strict despite easing rates

3) Interest rates: where we are now

On 12 August 2025, the RBA cut the cash rate to 3.60%. Major banks, including CBA, passed through -0.25% to variable home loans (effective 22 Aug for CBA). Fixed rates have also been nudging down at several lenders.

What’s good:

Lower deposit hurdle: Get in with 5% and avoid LMI thanks to the government guarantee. On a $700k Perth home, that’s $35k deposit (plus costs) instead of waiting for 20%.

More choice: Higher caps open suburbs that were previously out of reach for FHBs, especially in Perth up to $850k.

Competition heat: Expect more buyer demand in the refreshed cap bands (e.g., $700k–$900k in Perth). That can push prices and shorten auction timelines

Still tested at +3%: Even with lower rates, lenders must assess your repayments 3 percentage points higher than your actual rate. Borrowing capacity won’t jump as much as you think.

WA tip: If you’re shopping in Perth around the $700k–$850k bracket, get a bank-grade pre-assessment and be “contract-ready” (ID, payslips, statements, savings trail) before listings surge in spring. (Need help? Try our low-deposit home loans in WA or How to avoid LMI guides.)

Personal loans: BNPL rules now look more like “credit”

From 10 June 2025, BNPL providers must hold an Australian Credit Licence and comply with modified responsible-lending obligations.

For consumers, that means more affordability checks and stronger protections (e.g., hardship help, EDR).

If BNPL becomes less permissive for your scenario, you may compare regulated personal loans with clear rates/fees—and sometimes lower total costs.

Business lending: steady criteria, slowly easing costs

Banks are still cautious on serviceability and security, but pricing is flattening as the cash rate comes down. We’re seeing sharper competition on SME variable loans and overdrafts following the August rate cut, with scope for further relief if the RBA continues easing into late 2025/early 2026.

If you haven’t repriced your facility since rate peaks, it’s a good moment to review covenants and renegotiate. (Explore Business loans & asset finance with us.)

Context: the official cash rate is 3.60% and markets watch each RBA meeting for further trims.

Rate outlook: what the RBA and big banks signal

The August decision took the cash rate to 3.60%. Bank economics teams (CBA, ANZ, NAB, Westpac) have flagged scope for further cuts into late-2025/2026 if inflation keeps easing.

That typically means lower variable rates, periodic fixed-rate specials, and better refinance math for many borrowers. As always, it’s data-dependent – but the bias is now downward.

Your pre-October checklist (save or screenshot)

Confirm eligibility for the expanded HGS and your local price cap.

Run serviceability at +3% to avoid surprises; tidy expenses and retire small debts to lift borrowing power.

Update pre-approval with a lender that participates in the Scheme (not all do, and policies differ).

Stress-test repayments at today’s rate and one cut lower—then decide whether to keep repayments higher to build a buffer.

For BNPL users: expect more checks; consider consolidating to a single, transparent personal-credit product if it lowers total cost.

SMEs: audit covenants and repricing windows now that cash-rate momentum has turned.

Your edge if you’re approved now

Spring momentum: With more buyers qualifying under the new Scheme settings, the most competitive price bands (i.e., around the refreshed caps) may see faster days-on-market. Being finance-ready lets you move first on good listings.

Negotiation power: Sellers and agents tend to prioritise offers with clean finance clauses and recognised lender pre-approvals. That can mean better acceptance odds – sometimes even over a slightly higher but uncertain offer.

Valuation timing: In rising segments, recent comps can matter. Ordering valuations early (or lining up a lender with flexible valuation pathways) can reduce rework and delays.

Rate path optionality: If rates fall further before settlement, you can often reprice or switch products with minimal friction. Approval now doesn’t lock you into today’s exact rate forever.

Buffer clarity: You’ll know precisely how the +3% assessment treats your income, debts, and living costs. If something dents capacity (e.g., BNPL, after-tax HELP repayments, overtime treatment), you find out early – when it’s fixable.

How Broker360 helps – quietly and concretely

Scheme-smart lender matching: Not every lender participates in the Scheme – or treats construction, guarantors, or certain incomes the same way. We pre-screen policy and participation so you’re not burned by last-minute “computer says no.”

Capacity mapped to caps: We model your borrowing power against the new local price caps (including Perth) and overlay stamp duty and LMI-free pathways. See exactly which suburbs and property types fit.

Documentation sprint: A lean, bank-grade checklist (ID, income, liabilities, savings trail, rental history) plus same-day triage means your file is credit-ready before competition heats up.

Valuation strategy: We line up lenders with fit-for-purpose valuation panels (desktop/AVM, kerbside, full) and order at the right time to balance speed and accuracy – important in busy spring markets.

Rate strategy, not rate chasing: We set an “approve-now, reprice-later” plan: lock structure and features today (offset, splits), then benchmark and request reprices if the market moves before settlement.

Policy nuance, fewer surprises: Casual, overtime, bonus, self-employed addbacks, HELP/HECS – we calibrate these across lenders so you don’t lose capacity to a technicality.

Transparent comparisons: Side-by-side, total cost over time (not just headline rates). We highlight break costs, revert rates, fee traps, and cashbacks so decisions are grounded, not gimmicky.

Final word 

If October’s changes put your goal within reach, let’s map it out – properly. We’ll run the numbers with the new HGS caps, test your borrowing at +3%, and price your options across 40+ lenders so you don’t overpay by accident.

Book a quick chat or send your docs to get a same-day game plan.

General info only – nothing here is personal advice. Policies and lender participation can change; always check current criteria and T&Cs with your broker.