Home loans · Education
Home Loans for Teachers
Teaching is about as stable as employment gets, and lenders like that. The thing that most often shapes a teacher's home loan is not your job security, it is your HECS or HELP debt and whether you are permanent, on contract, or doing casual relief work.
Get those two things framed properly and your borrowing power can look quite different. Here is how I approach a teacher's application, and where the easy wins usually are.
HECS and HELP debt: what it actually does
Your student debt does not show up on your credit file, and it will not stop you getting a loan. What it does is reduce the income a lender counts, because repayments come out of your pay once you earn above the threshold. On a typical teacher salary, a HECS debt can trim your borrowing power by tens of thousands. The good news is that some lenders treat it more kindly than others.
- Some lenders disregard a HECS debt that is small or nearly paid off, which can lift your number.
- Paying it down before you buy is not always smart, because draining your deposit can trigger LMI that costs more than you gain.
- The size of the debt matters, so it is worth modelling before you decide anything.
Don't rush to clear your HECS
I often see teachers about to hand over their savings to wipe a HECS debt right before applying. Sometimes that helps. Often it hurts, because a smaller deposit can cost you more in LMI than the borrowing boost is worth. Let's check the maths first.
Permanent, contract or casual relief
Permanent roles are the easiest to get across the line. Contract and casual relief income can absolutely be used, but lenders usually want to see continuity, often a 12 to 24 month history, before they count it fully. If you are new to a contract, there are still lenders who will work with you, and I know which ones.
If this is your first home, you may be eligible for government schemes that reduce the deposit you need. Start with my first home buyer support, and get a feel for the numbers with how much can I borrow.
Let's work out your real number
Book a free call and we'll factor in your HECS and your work pattern properly, so you know where you stand.
Frequently asked questions
Does my HECS debt stop me getting a home loan?
No. It does not appear on your credit file and does not block approval. It does reduce the income a lender counts, which can lower how much you can borrow. Some lenders are more generous about it than others.
Should I pay off my HECS before applying?
Not always. If clearing it drains your deposit, you could trigger LMI that costs more than the extra borrowing power is worth. It is worth checking both ways before deciding.
Can I get a loan on a contract or as a casual relief teacher?
Yes. Lenders usually want a continuity of income, often a year or two, but plenty of contract and casual teachers get approved. Book a call and we'll look at your history.
Important information
This information is general in nature and does not take your personal objectives, financial situation, or needs into account. It is not credit assistance or a recommendation to enter into any particular credit contract. Consider whether it is right for you and seek advice before acting. Lending is subject to a lender's eligibility and approval criteria. Terms, conditions, fees, and charges apply.
Greenwood Finance · ABN 23 671 049 693 · Credit Representative No. 551942.
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