As a student with a (VERY) significant HECS debt that I have to look forward to, do banks and lenders take this into account when calcualting how much money you can borrow?
Thanks in advance
Tracey
[
]Hi Tracey
The HECS debt will actually reduce your net pay as your employer will be required to deduct HECS monies each pay. This will affect your serviceability and therefore borrowing capacity.
Cheers
Stu
Hi Happytrace,
The banks will take your HECS debt into account, though i wouldnt be to worried about this, if your HECS debt is being payed off at a very low marginal, it may not be much significant loss against your earnings.
Though i think 6% out of the earnings is the most you have to pay if your on the highest tax threshold.
Though they are increasing the threshold on how much you have to earn before you have to pay your HECS back, so your HECS repayment could even be slightly less everyweek, which will be good and serve in your favour.
Cheers,
sisThough seriously i wouldnt be too worried about it.
I justed purchased my first IP and I also have a large HECS debt, not once was I asked about my HECS by either my mortgage broker or the bank. I think the banks may just look at your after tax income.
matthew
I have never had a loan that didn’t service purely due to the HECS debt.
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
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