New research has revealed rising demand for complex home loans, as brokers warn that current settings are shutting out a vast cohort of viable borrowers.
Bluestone Home Loans’ Specialist Lending Opportunity Report has found that income variability and non‑standard employment have become mainstream features of home loan applications – and that credit policy, rather than price, is increasingly determining who can access finance.
According to the report, most brokers now work in a world where the average client does not fit a textbook PAYG profile.
It found that income variability, non-standard employment, and complex financial structures had become a mainstream reality for the majority of brokers.
Brokers overwhelmingly reported that standard policy settings were struggling to keep up with this shift.
It found that 85 per cent of brokers said they frequently encountered deals that did not align with standard credit policy.
In the past 12 months, 75 per cent of surveyed brokers said they turned away at least one client due to credit policy, while 34 per cent turned away three or more.
A broker quoted in the report summed up the frustration many felt when assessing clients with strong underlying businesses but non-orthodox paperwork.
“Greater flexibility around alternative income verification and a more holistic view of business health would make a significant difference in getting these deals across the line,” the broker said.
As at August 2025, the Australian Bureau of Statistics noted that around 2.7 million Australians reported income that varied from one period to the next, with 1.1 million currently self-employed, representing 7.6 per cent of all employed Australians.
Reflecting that reality, 42 per cent of brokers nominated self-employed borrowers as their most difficult client segment.
Policy friction, not price, seen as main barrier
When asked about the biggest obstacles to placing complex deals, only 29 per cent of brokers pointed to rates or pricing, with restrictive credit policies and partial lending solutions emerging as the dominant pain points.
Brokers identified a range of recurring friction points where satisfactory clients could still be declined, including ABNs under 12 months, one-year financials, alt-doc income assessments, treatment of tax debt, and business liabilities being counted against personal borrowing.
The report noted that serviceability settings came up frequently as a growing source of disconnect, with buffers, HEM assumptions, and income shading often described as excluding borrowers who could afford repayments.
“Many borrowers are financially capable, but strict policy settings can exclude strong applicants unnecessarily,” one broker said.
Brokers said they wanted more flexibility around serviceability buffers, casual and commission income, overtime and allowances, business liabilities, income shading, and non-standard security.
Many also highlighted the frustration of so-called partial solutions – this being situations where serviceability worked, but the postcode was out of bounds or if income stacked up, but security failed policy.
‘Rate is a smokescreen, policy is the issue’
Bluestone’s head of non-standard lending, Aaron Taylor, said the results showed a clear opportunity for those prepared to lean into specialist solutions.
“Complexity in borrowers’ financials is no longer the exception, it’s the norm,” Taylor said.
“Brokers who are supported to navigate these scenarios by lenders that take a more flexible, real-world view of income and credit are the ones best positioned to grow.”
Taylor also pushed back on the idea that sharper pricing alone would solve the placement challenge in this part of the market.
“Rate is often a smokescreen, the real issue is policy. When lenders can assess the full picture rather than just tick boxes, more deals get done and better outcomes are achieved for their clients,” Taylor outlined.
Confidence gap in placing specialist deals
The research also pointed to a skills and confidence gap, with nearly half of all brokers surveyed (46 per cent) stating they were not confident placing near‑prime or specialist deals.
At the same time, 68 per cent indicated they wanted to do more of them.
Taylor said this gap underscored the value of education and lender support.
“Brokers who invest in specialist lending knowledge and align with supportive lending partners stand to gain a clear competitive advantage. Learning to identify and capture specialist opportunities drives growth, differentiation, and long-term sustainability,” he said.
[Related: Brokers turn to non-banks amid serviceability squeeze]
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