Can we still get a home loan if I'm going on parental leave?

Bayley Clarke · Mortgage broker on the road · Last checked 12 November 2026 · 7 min read

The short answer

Usually, yes. The bank mostly assesses the income you'll be on when you go back, not the leave itself, as long as there's a letter from your employer confirming your return and enough savings to cover the gap while you're off.

A baby on the way also goes into the application as a dependant, so expect the borrowing number to come down a little compared with two full incomes. That's normal. The point is to plan around the real number, early, rather than find it after you've made an offer.

Home loan on maternity leave: the return-to-work letter

If you're taking out a 30 year mortgage and you're off for six months, it would be a bit silly for a bank to judge you on those six months. So the number it generally assesses is your return-to-work income, and the document that carries it is a letter from your employer. It should confirm the start and finish dates of your leave, what you're coming back as, full time or part time, your hours and your expected salary. The bank will usually want your payslips from before the leave started as well.

If you're planning to go back part time, put that in the letter. The bank will assess the part time income, and it's far better to plan around that number now than find out later: I'm going on maternity leave soon. What does the bank need so we can still use my income?

Baby on the way and a move to make? Let's time it on a call

Half an hour with both of you. We go through your leave dates, your return plans and your savings, and I'll tell you what you can borrow as the family you're about to be.

Book a 30 minute call Call 0437 189 939

No application, no credit check, nothing on your file. Just the numbers.

The leave window and the savings buffer

While you're off, your income drops but the repayments don't. So the bank wants to see savings that cover the difference between what's coming in, like government parental leave pay, any paid leave from your employer and annual or long service leave, and what the repayments and living costs will be, for the length of the leave.

How big that buffer needs to be, and how long the leave can run before your return date, is where lenders differ. The common pattern is a maximum leave window somewhere from a few months to a year. Some assess your full return income from day one, some only use part of it until you're back, and a few want you returning to the same employer, not just to work. If your partner's income covers the loan on its own, most of this drops away. Picking the lender is the routing I do before anything is lodged.

Does the bank count a baby on the way?

Yes. It goes in as an expected change, a box we talk through together: you're a family of two, you're soon to be three. The baby is generally treated as a dependant in the numbers, the time off work is factored into your income, and the bank looks at the family you're about to be rather than the couple you are today. Adding a dependant and allowing for leave will usually bring your borrowing power down, so it's in the application from day one: We've got a baby due before we buy our house. Do the banks still count that as a dependant?

Buying vs refinancing on maternity leave

Refinancing on leave works on the same two tests: show what your income looks like when you're back, and show savings behind you to cover the gap. It's about your situation, not a blanket yes or no because you're on leave.

The normal refinance rules still apply on top. If the loan is under 80% of the property's value, the history is clean and it's been open a while, the options are wider. Above 80% they narrow and lenders mortgage insurance can come back into it. And if you've leaned on credit cards while on leave, get your credit report in front of you before applying: Can I refinance while on maternity or parental leave? More on switching in Refinancing your home loan with a broker: how it actually works

If you're still deciding whether to buy before or after the leave starts, have the conversation with a broker before the payslips stop. The letter and the buffer are much easier to sort while you're still at work.

A one income home loan, for a while

The bank takes each of your incomes after tax, adds them together and lends against the household total. Who earns more doesn't matter much. What matters is how each income is earned, and parental leave is one of the types a lender may only count in part until you're back: My partner and I earn very different amounts. How does the bank look at us as a household?

If one of you is buying alone while you live together, most lenders still put couple living expenses on the application, which pulls the number down. A few will apportion those costs if the other partner is working and self-sufficient, which is harder to show while they're on leave: How much could I borrow on my own, without my partner on the loan? The wider picture on what drags the number down is in Why is my borrowing power so low?

Centrelink and single parents

Some Centrelink income can count. Unemployment benefits won't, because they're designed to stop. Family Tax Benefit A and B are counted by nearly every lender, usually as a top-up to other income, with cut-offs tied to how old your kids are, because the bank wants the payment to keep coming for a few more years. Child support with a track record and a formal arrangement can be counted too, often at a reduced share: I receive Centrelink income. Does it count for a home loan?

If you're a single parent, the single parent stream of the 5% Deposit Scheme lets you buy with a deposit from 2%. It's for a single parent or single legal guardian of at least one dependent child, and you don't have to be a first home buyer, though you can't own other property once the new home settles. The government guarantees up to 18% of the property's value to the lender, so you're not paying lenders mortgage insurance for that gap. The deposit is the easy part. On one income with kids, what the bank will lend is still the real question: I'm a single parent. Can I really buy with a 2% deposit?

The honest part

Babies don't wait for settlement dates, and good properties don't wait for babies. Most of the stress I see here comes from leaving the bank conversation until the leave has started and the payslips have stopped. Sort the employer letter and the buffer early and it's a normal application.

Let's time the move around the baby

Buying or refinancing, before leave or during it. A 30 minute call and you'll know what the bank needs, what you can borrow, and the best order to do it in.

Book a 30 minute call Call 0437 189 939

No application, no credit check, nothing on your file. Just the numbers.

Common questions about home loans on parental leave

Can I get a home loan on maternity leave?+

Generally, yes. Most lenders assess your return-to-work income, backed by a letter from your employer confirming your return date, role, hours and salary, plus savings to cover the shortfall while you're off. Lenders differ on how long the leave can be.

Can I refinance while on parental leave?+

Yes, on the same basis: evidence of your return-to-work income and savings to cover the gap during leave. The usual refinance rules still apply, so options are wider when the loan is under 80% of the property's value.

Does the bank count a baby on the way?+

Yes. A baby due before you buy is declared as an expected change and generally treated as a dependant, with the time off work factored into your income. It usually lowers your borrowing power, so it's better built in from the start.

How much savings do I need while on parental leave?+

Enough to cover the gap between your leave income and your repayments plus living costs, for the length of the leave. The exact buffer and the longest leave window allowed vary between lenders.

Does Family Tax Benefit count as income for a home loan?+

Most lenders count Family Tax Benefit A and B, usually as a top-up to other income, with cut-offs based on your children's ages. Unemployment benefits aren't counted.

Next question

What income counts for a home loan?

Return-to-work pay, part time, Centrelink and every other kind of income, and how much of it a bank will use.