If you are a doctor earning income from hospital work, private practice, or a mix of both, applying for a doctor home loan with mixed income can feel more complicated than it should. Your income may look strong overall, but lenders do not always assess it in a simple or consistent way. In the current Australian lending environment, how your income is structured and documented often matters just as much as how much you earn.
Many doctors we speak with are balancing PAYG and self-employed income, including hospital salary, private billings, contractor arrangements, or medical practice ownership. At the same time, interest rates, serviceability buffers, and responsible lending obligations remain tight across the market. This means lenders are paying closer attention to income stability, sustainability, and structure when assessing medical professional home loans.
As mortgage brokers in Sydney, we regularly help doctors navigate these complexities. This article explains how structuring a home loan around private practice or hospital work is typically approached in Australia today, what lenders usually look at, and why the right structure can make a meaningful difference, depending on the lender.
Why mixed medical income needs careful loan structuring
When your income comes from more than one source, lenders rarely assess everything the same way. PAYG hospital income is often viewed as more predictable, while private practice income may fluctuate month to month.
Before looking at specific lender policies, it helps to understand why structure matters. A well-considered loan structure may help align repayments with how you are actually paid. It can also reduce delays during assessment by presenting your income clearly and consistently.
With that context in mind, it is useful to look at how lenders usually assess each income type separately, starting with hospital employment.
How lenders typically assess PAYG hospital income
PAYG income from hospital work is usually the most straightforward part of a loan assessment. This is commonly relevant for borrowers exploring doctors home loan options, where hospital income forms the base of serviceability. Most lenders assess this income using recent payslips, employment contracts, and sometimes year-to-date figures.
In general terms, lenders may consider:
- Base salary as the primary income component
- Overtime, penalties, or allowances separately
- Whether income is ongoing or linked to a fixed-term contract
Some lenders may average variable components over a period of time, while others may cap or exclude them if they are irregular. Rotations, probation periods, or contract renewals can also be reviewed, depending on the lender’s policy.
This part of the assessment usually sets the foundation of borrowing capacity. Once this is clear, lenders then turn to private practice income, which is often assessed very differently.
How private practice income is usually treated
Income from private practice is commonly assessed as self-employed income, even if you operate through a service entity or receive distributions rather than wages. This is where lender approaches can vary significantly.
Some lenders may:
- Rely on personal and business tax returns
- Review financial statements and notices of assessment
- Average income over one or two financial years
Newly established practices are often assessed more conservatively. If your practice has not yet completed a full financial year, some lenders may use limited income evidence or apply additional buffers.
Certain lenders in the market have simpler approaches to self-employed income assessment, particularly for established professionals. Policies like these are discussed in the context of self-employed lending frameworks, including the Bankwest simple policy, which is one example of how income evidence requirements can differ between lenders.
At this stage, lenders are not just looking at income amounts. They are also assessing how reliable that income appears over time.
Combining PAYG and private practice income in one application
Once both income streams are identified, the next challenge is how they are combined. Not all lenders assess mixed income in the same way.
Some lenders may:
- Assess PAYG and self-employed income separately
- Shade or discount private practice income
- Exclude certain income streams if documentation is incomplete
The way your income is presented can influence how smoothly this stage progresses. Clear separation between hospital income and private billings often helps lenders understand the overall picture without confusion.
This is also where borrowing capacity can vary noticeably between lenders. One lender may accept a higher proportion of private income, while another may rely more heavily on PAYG earnings. Understanding these differences helps set realistic expectations before you apply.
Medical practice ownership and lender risk assessment
Owning a medical practice introduces an additional layer of assessment for a medical practice ownership home loan that goes beyond income alone. Even if your personal income is strong, lenders may still review the structure and obligations of the practice itself.
Depending on the lender, this may include:
- The business structure, such as a company, partnership, or trust
- Practice-related liabilities or leases
- Existing business loans or equipment finance
Practice ownership does not automatically reduce borrowing capacity, but it can trigger more detailed questions. Some lenders are more familiar with medical practice structures than others, which can influence how comfortably they assess these arrangements.
This is particularly relevant when practices are held in trusts or involve multiple practitioners. Broader considerations around trust loans and investing can also come into play, depending on how the practice is structured.
Structuring a home loan around variable medical income
Once the income assessment is understood, the home loan structure becomes the next consideration. For doctors with fluctuating private income, structure is often about flexibility rather than maximising borrowing power.
Depending on the lender and product features, this may include:
- Using offset accounts to manage uneven cash flow
- Splitting loans to separate stable and variable income
- Aligning repayment types with income patterns
These are not strategies that suit everyone, and availability varies by lender. The key point is that the structure should reflect how your income is received and managed in real life, rather than assuming income is evenly spread throughout the year.
This approach also helps reduce stress during periods where private billings may dip or expenses increase.
First home buyers with hospital and private income
Doctors buying their first home while earning a mixed income can face additional complexity. First home buyer incentives do not change how lenders assess income, but they can influence overall affordability.
For first home buyers, lenders may:
- Apply tighter serviceability buffers
- Scrutinise variable income more closely
- Require clearer documentation
If you are entering the market for the first time, understanding how your income will be assessed early can help avoid surprises later. This is particularly relevant when hospital income is stable, but private practice income is still growing.
Understanding the interaction between income assessment and first home buyer home loan eligibility can help set realistic expectations before you commit to a purchase.
How we help doctors compare lender policies without assumptions
Every lender sets its own rules, and those rules change over time. There is no single approach that works for every doctor or every income mix.
When we assist doctors, our role is to:
- Compare how different lenders assess PAYG and private income
- Identify policy differences around practice ownership
- Structure applications based on current lender criteria
We focus on presenting income clearly and accurately, without assumptions or overstatements. This helps reduce delays and supports responsible lending outcomes.
Importantly, all comparisons are based on verified, up-to-date lender information at the time of assessment.
Bringing hospital and private income together with clarity
Structuring a home loan around hospital work and private practice is rarely about pushing limits. It is usually about clarity, preparation, and understanding how lenders think.
If you earn income from multiple medical sources, taking the time to understand how each part is assessed can help you make more informed decisions. It also allows you to plan your application around realistic outcomes, rather than assumptions.
If you would like to see what options may be available for your situation, our brokers at Unconditional Finance can help you compare policies and guide you through the next steps.
Disclaimer: This information is general in nature and does not take into account your objectives, financial situation, or needs. Lending criteria, policies, and product features vary by lender and may change without notice. You should consider whether this information is appropriate for your circumstances and seek professional advice before making any financial decision.
Frequently Asked Questions (FAQs)
Having an ABN does not automatically make borrowing harder, but it can change how lenders assess your income. Some lenders treat ABN income as self-employed income and may require financial statements or tax returns. Eligibility and documentation requirements vary depending on the lender’s policy.
Some lenders may consider recent billings, but newer or growing income streams are often assessed cautiously. Lenders typically look for consistency and sustainability rather than short-term spikes. How much of this income is used can vary depending on the lender.
GST registration itself does not usually reduce borrowing capacity. However, lenders may review gross income, net income, and business expenses differently when GST is involved. Clear separation between GST and personal income is often important during assessment.
Some lenders may add back certain non-cash or one-off expenses, such as depreciation, when assessing self-employed income. This depends on the lender’s policy and the nature of the expense. Not all expenses are treated the same, and add-backs are not guaranteed.
Income gaps are not always an issue, but lenders may ask for context. Short gaps due to training, credentialing, or practice setup are sometimes acceptable, depending on the lender. Consistent income before and after the gap is usually more important than the gap itself.
Salary packaging and novated leases can affect how lenders calculate net income and living expenses. Some lenders assess packaged income differently, which may slightly change serviceability results. Assessment methods vary by lender and can change over time.
Making changes to how income is paid or structured can affect lender assessment. Speaking with a loan broker early, such as Unconditional Finance, may help you understand how different lenders currently view these structures. This allows you to plan with clearer expectations, rather than assumptions.