Bank Australia Home Loan Lending Policy 2026

A Bank Australia home loan requires an eligible borrower with verified funds and income. The property must also meet the bank’s security conditions. The product also matters: ordinary purchase lending, construction and bridging have different limits.

An offset requires an eligible loan and a completed account link.

Bank Australia Limited is the lender, with Australian credit licence number 238431. Its broker resources include the underwriting policy and serviceability and postcode tools, as at October 2026. Use these to assess the file alongside the product terms.

The lender-policy guides explain how those assessment points differ between lenders.

Applicant and Deposit Questions

Bank Australia’s June 2026 underwriting policy accepts individuals aged 18 or older who work and live in Australia and hold Australian or New Zealand citizenship or permanent residency. Overseas-resident applicants have separate conditions. Record citizenship, residence and borrower structure before assessing the deposit.

The same policy requires verified funds for the purchase and associated costs. Above a loan-to-value ratio (LVR) of 90%, at least 5% of the purchase price must be genuine savings, except where a participating government scheme’s requirements apply. Genuine savings requires a demonstrable three-month pattern in at least one borrower’s name.

Gifts can help complete the purchase, but Bank Australia excludes them from genuine savings. An acceptable family gift needs a letter confirming it’s non-repayable and the giver has no property interest. Keep the transfer trail with that letter.

Reconcile the deposit in a simple funds table before you submit the application.

Funds item	Evidence to retain	What to resolve
Savings	Statements identifying the holder and balance history	Which funds meet the genuine-savings rule
Family gift	Gift letter and corresponding transfers	Whether repayment or an ownership claim exists
Sale proceeds	Sale and settlement documents	Net funds available and when they arrive
Equity borrowing	Existing property and loan evidence	Added debt and its repayments
Purchase costs	Conveyancer’s estimate and relevant charges	Funds left after the contract deposit

For example, a fictional buyer has $70,000 in savings and a $30,000 family gift. The $100,000 total doesn’t establish that $100,000 is genuine savings. Identify each source and reserve funds for purchase costs before calculating the loan required.

As at October 2026, Bank Australia’s Australian Government 5% Deposit Scheme supports eligible first home buyers with a minimum 5% deposit. Eligible single parents or legal guardians can use a minimum 2% deposit. Citizenship or permanent residency, owner-occupation and property price caps apply under the scheme.

Those scheme deposits aren’t universal Bank Australia deposit rules. The minimum-deposit guide explains how the deposit, purchase costs and lenders mortgage insurance (LMI) interact.

Income and Commitment Evidence

Bank Australia’s April 2026 application checklist specifies different evidence for each income type. Collect the records for the income actually used in the application.

Income used	Checklist evidence
Pay as you go (PAYG) base salary	Two recent consecutive payslips, or three months of salary credits to a Bank Australia account identifying the employer
Overtime	Two recent payslips showing six months of year-to-date income, or six months of Bank Australia salary credits
Commission or bonus	Two years of PAYG payment summaries
Self-employed income	Two years of relevant tax returns, business profit and loss statements, balance sheets and Australian Taxation Office (ATO) assessment notices
Rental income	Managing-agent statement, qualifying rental credits, tenancy agreement, appraisal or latest tax return

For self-employed applicants, the latest return must be within 18 months of application. The checklist allows case-by-case consideration where trading history is under two years. That requires a specific assessment, not an assumption that two years of documents can be skipped.

Bank Australia’s June 2026 employment policy also considers probation and employment continuity. Its standard casual and second-job criteria require 12 months in the current position. Document an income change separately from the evidence showing money received.

As at October 2026, Bank Australia’s application guidance asks about regular bills, credit limits and discretionary spending. Reconcile declared expenses with transaction records. Record each liability’s limit, balance and repayment, including buy now, pay later products and debts being refinanced.

The April 2026 checklist requires three months of transaction evidence. Where formal statements arrive less often, include the latest formal statement with transaction listings showing account numbers and running balances. Spreadsheet exports aren’t accepted for that purpose.

A payslip proves earnings. It doesn’t establish how much income Bank Australia will count for servicing, or whether the proposed repayments fit the household’s expenses.

Security Conditions

Bank Australia’s June 2026 security policy applies both property conditions and postcode restrictions. The lower applicable LVR limit governs the security. Record the address, zoning, property type, floor or land area, occupancy and valuation basis before comparing the loan with the property’s value.

Bank Australia’s residential loans table, effective 6 November 2025, lists a 90% maximum LVR including LMI for ordinary land or construction lending. That product limit doesn’t override a lower property or postcode restriction.

For example, a fictional $540,000 construction loan against a $600,000 completed valuation has a 90% LVR. If the applicable security limit is lower, the file needs a smaller loan, more acceptable equity or a different lending structure. The 90% product figure alone doesn’t establish approval.

For construction, assemble the builder’s contract, approved plans, specifications and indemnity insurance. Explain whether the request funds a build, an existing home purchase or a refinance. Different purposes produce different document and valuation questions.

Bank Australia’s Basic Home Loan is an interest-bearing purchase and refinance product, as at October 2026. A borrower seeking Islamic home finance needs a finance contract that meets their Sharia requirements. Customer ownership and ethical banking statements don’t establish that contract structure.

Keep the property assessment with the lender comparison. A general home loan review or a favourable advertised rate doesn’t answer whether Bank Australia accepts this particular security.

Written Policy Answers

Send Bank Australia a complete scenario when a security restriction or exception affects the decision. As at October 2026, its forms and resources provide the supporting documents and broker contact route. The Bank Australia broker access guide explains access and support channels.

Include the applicant structure, loan purpose and proposed amount. Add the security address, valuation and LVR, plus the exact condition requiring a decision. Attach the documents that establish any unusual property feature or income circumstance.

For example, ask whether a particular apartment’s area and title meet the security conditions at the proposed LVR. A question asking only whether apartments are accepted leaves the deciding facts out.

Keep the respondent’s name and role, response date and referenced policy version. Record whether the answer is standard policy, a file-specific exception or a request for further evidence. If the loan amount or security changes, obtain an answer covering the revised facts.

Bulma’s Policy Advisor quotes the lender policy behind an answer, so you can retain the wording in file notes. A lender’s written exception remains separate from that policy evidence. The lender’s assessment decides approval.

Bank Australia Bridging Availability

Yes, Bank Australia has a Bridging Loan, as at October 2026, for buying or building before an existing property sells. Its published term is up to 12 months. The residential loans table effective 6 November 2025 lists a 75% maximum LVR and no offset facility for bridging.

The loan can cover existing property debt, the new purchase price and related purchase costs. Interest is calculated daily. On sale, the borrower repays the bridge and interest, or converts the remaining debt to another Bank Australia home loan.

Prepare the purchase and sale dates, existing debt, both property details and the expected net sale proceeds. Model the debt during the overlap and the debt remaining after sale. Include selling costs and accrued interest so the sale exit isn’t overstated.

A purchase funded after the existing home has settled doesn’t have the same overlap. A construction loan with an existing unsold home can require bridging treatment even though the new property’s purpose is construction.

Bank Australia’s product page lists a $595 establishment fee and no monthly fee. It directs bridging applicants to call 132 888. For a broker-led file, request written confirmation of the proposed bridge and the remaining loan before relying on the sale exit.

Offset Account Eligibility and Linkage

Bank Australia’s Offset Home Loan and Clean Energy Home Loan support a 100% offset on eligible variable lending, as at October 2026. The offset fact sheet, effective 5 December 2024, permits unlimited linked offset accounts on variable products, including interest-only loans. Fixed lending permits one offset account with a $20,000 cap.

The Basic Home Loan has no offset. Bank Australia’s Offset Home Loan has a $199 annual loan fee, while the offset account has no monthly account fee. Treat the loan fee and the account fee separately when comparing products.

Bank Australia’s account conditions, section 6.1, require the offset holder to be a party to the linked home loan. Each offset can link to only one eligible loan account. Linking can take up to five business days after eligibility conditions are satisfied, and the benefit starts only once the accounts are linked.

Follow the published setup procedure.

1. Select the qualifying loan product and identify the loan account or split receiving the offset.
2. On a new Offset Home Loan application, select the option to open the offset account. Bank Australia links the accounts.
3. If you already have the loan, open the account through the app or internet banking. Contact Bank Australia to complete the link.
4. Retain confirmation of the linked loan account and commencement date. An open transaction account alone doesn’t prove the offset is active.
5. Reconcile the first full linked period against the loan’s interest charge using daily loan and eligible offset balances.

In a fictional variable-loan example, a $500,000 balance with $40,000 continuously in its linked offset accrues interest on $460,000. On eligible fixed lending, the $20,000 cap means that same deposit reduces the interest-bearing balance to $480,000.

The offset reduces interest charged, while the scheduled principal-and-interest repayment remains due. If the charge doesn’t match the daily balances, ask Bank Australia to check the linkage date and selected loan account. Keep that response with the statements before treating the client’s offset setup as complete.