Income & Employment Home Loans

A home loan is something you're committing to for decades, usually a standard 30-year term.

Before a lender says yes, it wants to know your income isn't going anywhere. That's why your employment type matters as much as your salary.

PAYG, casual, contract and self-employed income all get assessed differently. The paperwork each one needs is different too.

This guide walks through how lenders think about income, what each employment type needs to prove, and what to do if your situation has just changed. If you work for yourself, our dedicated self-employed home loans guide goes deeper on business income.

Lenders look for stability first.

For most employment types, they want to see your income has held steady, or grown, over the past one to two years, with no reason to expect a drop.

That expectation eases for a recent job change, though. Several lenders publish no minimum time in a new permanent role and will assess you off just a couple of payslips rather than years of history — we cover the detail on starting a new job further down this page.

Not every dollar counts the same way.

Rental income is a common example: most banks will only take 75-80% of it into account, treating it as less reliable than employment income. Overtime, bonuses, commission and allowances get the same kind of scrutiny, which we cover further down this page.

Two people on the same gross income can end up with very different borrowing power, once a lender applies its own view of how reliable that income is. A lender will also want to see your bank statements and your living expenses measured against a standard benchmark, not just your payslip.

Permanent full-time or part-time PAYG employment is the easiest for a lender to assess.

You're paid a set wage, tax is already withheld, and a payslip and ATO income statement (the document that replaced the old group certificate) usually tell the whole story.

Part-time employment is assessed the same way, just on a smaller base income, so your deposit and expenses carry more weight.

Casual employment is treated differently again.

Lenders usually want a consistent history in the role, and they'll look closely at your hours rather than assuming a good week is a typical one.

Contract income depends heavily on how long you've been contracting, and whether you're on a PAYG arrangement or invoicing through your own ABN. The longer and more consistent your contract history, the more of it a lender is willing to count.

If you're self-employed and can't supply the full set of income documents a lender would normally ask for, low doc loans are worth understanding before you assume you can't borrow at all.

And if your situation doesn't fit any of the categories above, unusual employment arrangements still have a path through. It just usually needs more explaining upfront.

Running a trade under your own ABN brings its own rules on top of the self-employed basics, which our tradie home loans guide covers.

Overtime, shift loading, bonuses, commission and allowances all sit outside your base salary.

Lenders treat each one on its own merits rather than as guaranteed income.

A common way lenders check this is the year-to-date figure on your payslip.

Take a casual barista whose hours drop over a run of public holidays. If a bank only looks at one recent pay cycle, it can read that dip as a permanent income fall, when it's nothing of the sort.

Different banks will annualise the same payslip differently, which is exactly why the number one lender quotes you isn't the number every lender will quote.

Run your own numbers through the YTD calculator before you rely on a single lender's read of your payslip. It won't replace a lender's assessment, but it's a starting point that's closer to reality.

If a temporary dip in income is behind you rather than ahead of you, say so early. A short explanation with the right supporting payslips is usually enough to stop a lender reading a blip as a trend.

Starting a new job doesn't rule you out, even during probation.

Lenders generally want to see you staying in the same industry, rather than making a complete career change at the same time you're applying.

The broader employment history a lender is looking for matters here too. A short gap or a recent move reads very differently depending on what came before it.

Planning a family isn't a reason to put a home loan on hold.

Our maternity leave home loan guide covers how lenders assess your income if you're on leave now, or about to be, and what documentation makes the difference.

A HECS-HELP debt only starts reducing your take-home pay once your income passes the compulsory repayment threshold — $69,528 for the 2026-27 year. Below that, you make no compulsory repayments, so your pay isn't reduced — though a lender may still take the balance itself into account, depending on its policy.

Above the threshold, the compulsory repayment lenders factor into what they'll offer starts at 15 cents in every dollar you earn over it. It rarely rules a loan out on its own, but it's worth understanding before you get a number back that's lower than you expected. Our HECS and home loans guide explains how the debt is treated.

Most lenders want to see the same broad categories of proof: recent payslips or business financials, tax returns where relevant, and bank statements covering the last few months. Exactly what's asked for still varies by lender and by application — some run a faster lane for eligible, low-risk borrowers that skips bank statements altogether.

Know that a lender will review every transaction in that period, not just the balance.

Our guide to how many months of bank statements you need explains what lenders are actually looking for in there.

Your living expenses are checked against the Household Expenditure Measure, a standard benchmark lenders use to sanity-check what you say you spend against what a household in your circumstances typically does.

If your declared expenses sit well below the benchmark, expect a lender to ask questions.

If your income and expenses on paper leave less borrowing room than you'd hoped, our guide to seven proven strategies to lift your borrowing power sets out practical, unglamorous ways to close that gap before you apply.

Two applicants with near-identical income can still end up with very different outcomes, purely because one lender reads their payslip or business financials more generously than another. Matching the application to the right lender's policy is often the difference between an approval and a decline.

Talk through your income and employment with a broker before you apply, so the lender you choose is one likely to read your file the way you need it read.