APRA has formally activated its macroprudential handbrake. Here is your roadmap to navigating the high debt-to-income (DTI) cap without losing momentum.
20% Limit
On new originations with DTI ≥ 6
Two-Speed
Owner-Occ vs Investor portfolios
Active
Strict compliance for SFIs
For the first time in Australian history, APRA has shifted DTI from a monitoring metric to a formal volume cap. Lenders must now restrict loans with a Debt-to-Income ratio of 6 or higher to a maximum of 20% of their total quarterly flow.
For you, the broker, this means the 'automatic approval' for high-equity but high-debt clients is over. Loans are now competing for a limited spot in the 20% bucket.
Source: APRA Macroprudential Implementation Settings 2026
| Segment | Threshold | Volume Cap | Measurement | Exemptions |
|---|---|---|---|---|
| Major Banks (SFI) | DTI ≥ 6 | 20% | Quarterly | New Build, Bridging |
| Smaller Banks | DTI ≥ 6 | 20% | 4-Quarter Rolling | Carve-outs apply |
| Owner-Occupiers | - | Separate Port. | Ongoing | Primary Residence Xfer |
| Investors | - | Separate Port. | Ongoing | Construction Only |
What can you do differently tomorrow? Select a strategy below to explore.
Support national housing goals to bypass the cap.
Finance for the construction of new dwellings and the purchase of newly erected properties are formally exempt from the DTI limits. This is a massive strategic window for clients who are hitting the DTI wall on existing dwellings.
Meticulous income documentation is no longer optional.
A DTI of 5.9 is a 'pass'. A DTI of 6.1 is 'restricted'. Your job is to find the 0.2 difference. Focus on maximising the denominator (income) through all compliant means.
When the ADI bucket is full, look elsewhere.
Non-bank lenders (non-ADIs) are not bound by APRA's specific 20% volume cap on high DTI originations. While they still follow Best Interest Duty (BID) and NCCP, they have more flexibility in managing their risk appetite for high-geared borrowers.
Strengthen your non-bank accreditations. In 2026, they will be your primary solution for high-DTI investor growth.
Expect 1:1 debt-to-income scrutiny.
Lenders now place significantly more weight on the total debt versus income position of trust beneficiaries. Discretionary unit trusts are facing higher assessment hurdles as lenders move to transparently link personal income to entity debt.
Pre-engage with the client's accountant to ensure historical profit distributions clearly support the DTI calculation before the application is lodged.
Don't let policy changes stall your business. Reassess your high-leverage deals against the new 20% reality.