Why You Need to Check Your Loans URGENTLY! APRA’s New DTI Rules

In this urgent episode of SugarMamma’s Fireplay, I sit down with senior mortgage broker John Micalizzi from Blue Lantern Home Loans to unpack APRA’s new Debt-to-Income (DTI) rules – what they mean, who’s most at risk, and why you cannot afford to ignore your numbers.

John can assist you with any concerns regarding your DTI. 

John' contact details: john@bluelantern.com.au Mobile:  0411 706 228  

Blue Lantern address: Level 6, 309 George Street, Sydney, NSW 2000

If you have:

• A large mortgage

• Investment properties

• Interest-only loans

• Or you’re planning new lending, refinancing or debt recycling

…this episode is essential listening.

We talk about why this change is a proactive “pre-emptive strike” by APRA, how the new 20% cap on high DTI loans works, and the very real risk of being pushed into higher repayments, forced P&I, or simply being told no by your bank – especially with current backlogs and delays across the major lenders.

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What we cover inside the episode

• What DTI actually is
  – How to calculate it in plain language (total debt ÷ total gross income)
  – Why all debts count: mortgages, credit cards, HECS/HELP, personal loans, etc.

• APRA’s new DTI rule explained
  – The new cap on loans with DTI of 6 or more
  – Why APRA has brought this in now as a protective measure
  – Why it’s a blanket rule across owner-occupiers and investors

• Who’s safe and who needs to worry
  – Borrowers with DTI well under 6 vs those above 6
  – Why high-debt, high-leverage borrowers and some investors are most exposed
  – Why construction and bridging loans are treated differently

• Why interest-only borrowers must act early
  – How to check when your interest-only term expires
  – Why extending I/O is effectively a new application (full reassessment)
  – The double hit risk:

  1. Rolling from I/O to P&I (big repayment jump)

  2. Rolling to an old, uncompetitive “roll-to” rate from years ago

• Life changes that can push you into high DTI territory
  – Going from two incomes to one (having a family, study breaks, job loss)
  – Why timing and lender policy really matter here
  – Why you need a broker who knows which lenders can work with maternity leave, self-employed income and more complex scenarios

• Pre-approvals and the 1 February deadline
  – What to do if your pre-approval expires after 1 Feb
  – How your borrowing power could change under the new cap
  – Why you may need to reset your expectations on price or timing

• Backlogs, complexity and why you can’t leave this to the last minute
  – The current delays at many banks for new loans, refinances and restructures
  – Why higher DTI = more complexity = more questions = more time
  – Why you cannot expect to “sort it out in 48 hours”

• Practical steps to protect yourself now
  – How to check your own DTI and loan terms
  – Cleaning up your debts: unused credit cards, HECS/HELP strategy, etc.
  – When you should consider refinancing, restructuring or going P&I on purpose
  – Why working with an experienced broker can give you more options, more clarity and someone to advocate for your case with the lender

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3 urgent actions after you listen

1. Jump into your internet banking
   – Check: loan types, interest-only vs P&I, and expiry dates on I/O terms.

2. Roughly calculate your DTI
   – Add up all your debts (home loans, investment loans, credit cards, personal loans, HECS/HELP, etc.)
   – Divide by your total gross income (yours + partner’s, plus rental income, dividends, etc.).

3. If your DTI is high OR your interest-only term expires within 12 months
   – Do not wait.
   – Reach out for advice before the new rules + bank backlogs box you into a corner.

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💬 Let’s Keep the Conversation Going

I’d love to hear your thoughts on this episode! Reach out to me anytime on Instagram @SugarMammaTV so we can keep this important conversation alive.

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⚖️ General Advice Warning

While we discuss financial topics, everything shared here is general information only — never personal, product, or investment advice. Always:

• Do your own research.
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Canna Campbell is an Authorised Representative and Financial Adviser of Links Licensee Services Pty Ltd (AFSL No. 700012 | ABN 97 678 975 589).

 

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