Past-year update / LENDING POLICY / APRA
APRA’s 2026 debt-to-income limits: what do they mean for home buyers?
A new portfolio limit began on 1 February 2026 for APRA-regulated lenders. It limits the share of new lending at a debt-to-income ratio of six or more; it is not an automatic ban on every borrower.
APRA’s rule limits high debt-to-income lending across an authorised deposit-taking institution’s new residential mortgage portfolio. It does not make a six-times-income application automatically ineligible; the lender must still assess the individual application and its own policy.
What changed?
APRA announced the measure on 27 November 2025, with effect from 1 February 2026. Authorised deposit-taking institutions may have no more than 20% of new owner-occupier lending and 20% of new investor lending, measured separately, at a debt-to-income ratio of six or more. APRA lists specific exemptions, including certain new-dwelling and bridging finance.
The limit applies to regulated institutions’ new-loan portfolios. APRA said it had powers to extend macroprudential measures to non-APRA regulated lenders in particular circumstances, but had not used those powers for this measure at the time of its announcement.
What is debt-to-income?
For this measure, debt-to-income compares a borrower’s debt with verified gross income under APRA’s reporting definition. It is one risk measure; it is not the same as a full assessment of whether repayments are affordable.
What should an applicant ask?
A lender may have its own credit policy and available capacity under the portfolio limit. Applicants should give a complete picture of existing debts and income, and ask their broker or lender how the current policy applies to the proposed loan.
- Do not assume a six-times-income ratio creates an automatic refusal or approval.
- Check the current lender policy and whether any stated exemption applies.
- Assess repayments, fees and loan suitability separately from the DTI ratio.
Official sources
This article explains a past announcement and is not personal credit, legal or financial advice. Confirm current APRA settings, exemptions and So Money product policy before approval.