When specialist lending becomes the norm

Specialist lenders say complex borrowers are now mainstream. For brokers, that means treating specialist options as core tools, not last resorts, as income and credit profiles shift

THERE IS a growing gap between the shape of Australian borrowers’ financial lives and the shape of the credit assessment tools designed to evaluate them. Higher rates have tightened serviceability. Rising living costs have eaten into savings buffers. A short supply of housing stock has pushed buyers into structures and locations that major lenders have grown cautious about. The result is a widening category of people who can genuinely service a loan but cannot prove it in the terms a major bank’s scorecard is prepared to accept. Specialist lenders have been watching that gap open up for some time. Quietly and without fanfare, they have been building the tools and the appetite to work within it. As more Australians find themselves outside the neat lines of standard credit policy, specialist and non-bank lenders are moving from the margins to the mainstream. Leading non-banks see this change from different vantage points, but with a similar conclusion: specialist lending is no longer a side street, and it’s changing how brokers think about client files that would once have gone in the too-hard basket. The problem is not so much borrowers’ willingness or ability to repay, but the way traditional credit models define what ‘good’ looks like.

From ‘credit challenged’ to ‘financially complex’ Lemon drills into the specific borrower types that are now routinely landing on brokers’ desks. “Refinancing remains a key driver, particularly for borrowers who don’t meet standard policy,” he says. “We’re also seeing short-term self-employed borrowers looking to access equity, including those experiencing cash flow challenges due to customers not paying invoices on time.” He points out that many of these borrowers are running viable businesses but are being squeezed by delayed payments and uneven income, rather than poor trading performance. “Other common scenarios include borrowers going through separation or divorce, as well as borrowers needing to address outstanding ATO debt,” says Lemon. The ATO has been far more assertive on arrears and repayment plans, he says, and that’s driven demand for more flexible solutions. CreditorWatch data shows that ATO tax default counts rose sharply in December, to the highest level since the significant ramp-up in collections activity that occurred post-COVID. Business insolvencies have been at or near record highs since mid-2025, and total insolvencies for the current fiscal year were on track to at least equal those in the previous reporting period, even before the war in Iran set fuel prices soaring.

MA Money is keeping its credit settings robust while staying open to these more varied scenarios, Lemon says. “Our approach is to remain responsive to these types of scenarios while maintaining a strong credit framework.” For MacRae, the same adjustment is evident in the way borrowers calibrate their expectations before they even start an application. “Borrowers are adjusting to the conditions,” he explains. “Many are expanding their search areas, reconsidering property types or looking at shared-ownership models. Others are refinancing to consolidate debt or tidy up commitments before applying.” He says Bluestone’s response has been to match that flexibility when assessing each file. “We’re responding with fast, common-sense credit assessment that takes the full picture into account. Our alt-doc options support business owners whose revenue flows differently to traditional PAYG income, and our BDMs work closely with brokers to help navigate the scenarios that don’t fit cleanly into mainstream credit rules. This is where our experience with complex situations really shows its value,” says MacRae.

What comes next for specialists and brokers Neither lender expects these trends to fade in the next couple of years. If anything, they are planning for more borrowers to sit just outside the traditional mould. “Specialist lending is likely to become even more common as economic pressures continue,” says MacRae. “Self-employed lending will keep growing as more Australians move towards gig work or multiple income streams. Refinancing will remain strong as borrowers adjust to higher rates. And responsible lending oversight will continue to sharpen, especially where debt levels are higher.” Bluestone is investing heavily in its own infrastructure and broker-facing resources to keep pace. “We’re broadening our product range, investing in faster credit decisioning, strengthening our BDM network and enhancing our early risk detection – while remaining laser-focused on broker service and experience, ensuring people stay at the heart of what makes us different,” says MacRae.

Homeownership is a fundamental part of the Australian dream. However, the path can be challenging, especially when traditional lending can be strict and unforgiving. We’re here to change that. Since 2000, Bluestone Home Loans has been helping borrowers with complex or unique financial situations access the market with confidence, offering them a chance to purchase property – when others won’t – by providing tailored lending solutions. We empower brokers to serve a broader range of clients, from self-employed professionals to borrowers with past credit issues or those seeking niche lending options. With a 25-year legacy, Bluestone Home Loans has become a trusted leader in the Australian lending market, known for delivering innovative, flexible and straightforward solutions that break the mould of traditional lending.

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“The current environment is driving demand for specialist lending as interest rates and cost of living pressures affect borrowers’ ability to meet traditional lending criteria,” says Tim Lemon, national sales manager at MA Money. As serviceability tests remain tight and everyday costs keep biting, more borrowers are slipping outside the neat lines of major bank policy, he says. “We’re seeing refinancing from customers who no longer fit standard bank policy, along with short-term self-employed borrowers looking to scale their business or access equity for home renovations.” That pattern is familiar from previous tightening cycles, Lemon adds, with borrowers focusing on stabilising their position rather than stretching for a bigger home. Across town, Bluestone Home Loans’ chief commercial officer, Tony MacRae, is watching a similar broadening of the customer base. “Higher rates, tight affordability, stricter regulation and a short housing supply are pushing more borrowers into non-standard scenarios,” he says. “What used to be edge cases are now everyday cases.” For many of these borrowers, the story is less about distress and more about complexity, MacRae explains. “These are genuine borrowers who can repay a loan, but the traditional boxes are harder to tick. What we are seeing now is not a fringe market,” he says. “Specialist lending has become part of the normal pathway for many borrowers, and brokers are treating it as a standard tool rather than a last resort.” For advisers, that change in status matters. It turns specialist products from an afterthought into something to consider early, especially when a strong client story is likely to clash with a rigid automated scorecard.

Tim Lemon

MA Money

Industry experts

How borrowers are reshaping their property ambitions As borrowing power has been squeezed, Australians have been rethinking how they participate in the housing market. That’s showing up in everything from ownership structures to postcodes. “We’re seeing borrowers become more flexible in how they approach property ownership,” says Lemon. “This includes purchasing through trust or company structures, which we continue to support despite some lenders moving away from this space. We’re also seeing multiple non-related borrowers purchasing together for investment purposes, more purchases in regional and non-metro areas, and borrowers relying on supplementary income such as granny flat income to support an owner-occupied purchase.” Indeed, Australians holding multiple jobs have slowly increased over the last decade. In the latest quarter, nearly a million people held more than one job. More than half of this number were women.

“Specialist lending is likely to become even more common as economic pressures continue”

Tony MacRae, Bluestone

“With the ATO taking a firmer approach to tax debt and repayment arrangements, specialist lending can provide a pathway for customers who need a longer-term solution to manage or refinance that debt,” says Lemon. MacRae agrees that the customer profile has broadened well beyond the traditional self-employed and bruised-credit set. “Today, more PAYG borrowers have small credit blips linked to cost pressures,” he says. “High-income earners sometimes fall outside automated bank models. Some borrowers need cash out to consolidate and simplify debt. Many self-employed customers also have financials that look inconsistent, even when their businesses are performing well.”

Lemon says MA Money is investing in both product design and education so that brokers can confidently identify when specialist options are appropriate. “We expect specialist lending to continue supporting self-employed borrowers who don’t fit the standard lending box, along with borrowers looking to refinance or consolidate debt,” he says. “A key priority is continuing to identify product and policy opportunities to support more specialist borrowers, and educating brokers so they better understand where specialist lending can help and the range of scenarios we can support.” For brokers, the message between the lines is that as more of their books become ‘financially complex’, understanding specialist options will not be optional. It will be part of how they prove their value to clients whose lives no longer fit a simple template.

“We’re seeing refinancing from customers who no longer fit standard bank policy, along with short-term self-employed borrowers looking to scale their business or access equity for home renovations”

Tim Lemon, MA Money

The new normal for ‘non-standard’ borrowers

Published 04 May 2026

Tony MacRae

Bluestone Home Loans

MA Money is one of Australia’s fastest-growing non-bank lenders, with over $5 billion in loans under management. Working in partnership with mortgage brokers, MA Money offers a broad range of lending solutions across residential, commercial, bridging, SMSF, vacant land, expat and non-resident property loans, including support for self-employed and non-traditional income clients. With flexible credit assessment, responsive service and streamlined processes, MA Money helps brokers move quickly and solve more complex scenarios. The focus is on certainty, speed and practical solutions that support brokers in delivering for their clients.

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Tony MacRae stepped into the role of chief commercial officer at Bluestone in August 2023, bringing with him a wealth of experience in financial services. He spent a decade at Westpac Group, where he served as acting CEO of RAMS and led third party distribution at Westpac. Known throughout the industry for his ability to drive sales initiatives and strategic direction, MacRae excels at building partnerships and leading teams towards impressive business growth. At Bluestone, he is focused on empowering the company’s broker partners to better serve customers. In addition to his work at Bluestone, MacRae has dedicated the last 11 years to the Royal Flying Doctors Service South Eastern Section as a board member and treasurer. He holds a Bachelor of Economics from Macquarie University.

Bluestone Home Loans

Tony MacRae

Tim Lemon, who joined MA Money in October 2023, brings over 20 years of finance industry expertise to his role as national sales manager. Lemon’s career is defined by his talent for finding out-of-the-box lending solutions benefiting both brokers and their clients. His extensive experience in business development at non-bank lenders underscores his ability to navigate complex financial landscapes.

MA Money

Tim Lemon

Source: ASIC insolvency statistics

6,000

9,000

12,000

2022/23

2023/24

2024/25

2025/26(to date)

7,942

11,053

14,722

9,869

Australian business insolvencies by financial year

Business insolvencies rising

Source: ABS multiple job-holders data

Australians holding multiple jobs

For MacRae, the core shift is from a focus on damage to a focus on complexity, and brokers who understand that distinction are better placed to position these deals with clients. “The shift has moved from ‘credit challenged’ to ‘financially complex’. More prime and near prime customers are choosing non-banks because they want speed, flexibility and a human assessment of their situation,” says MacRae. Alternative pathways, real limits Human assessment often starts with how income and cash flow are verified. For many self-employed clients, this is where specialist lenders are deliberately building different pathways. “Specialist lending gives people a fair chance when their situation doesn’t fit a rigid rulebook,” says MacRae. “A more practical look at cash flow helps when income doesn’t land the same way each month. Sensible tolerance for small credit blips lets people move forward rather than wait years to repair their record. And cash-out can help people consolidate and stabilise.” The boundaries of that flexibility are clear, MacRae says. “Bluestone provides access, not overextension. Specialist lending isn’t about stretching limits; it’s about giving capable borrowers the right structure where repayments are manageable.” Lemon agrees that flexibility has real limits and spells out how MA Money navigates those pathways in practice. “Specialist lending may provide an alternative pathway for borrowers who don’t neatly fit traditional credit policies, particularly self-employed customers who may have the income to support a loan but not the standard documentation required by major banks,” he says. In practice, that can mean leaning on different forms of evidence that still satisfy responsible lending rules. “For example, we accept alternative forms of income verification, such as an accountant’s letter, which can help reflect a borrower’s actual financial position. We’re also seeing specialist lending used for debt consolidation to help improve cash flow – though these solutions need to be appropriate for the borrower’s circumstances and long-term ability to repay,” says Lemon.

15,000

5.8%

976,000

5.9%

972,000

6.4%

949,000

Apr–Jun 2025

6.5%

Jan–Mar 2025

Overall multiple job-holding rate

Rate for males

Quarter

Number of multiplejob-holders

Rate for females

Jul–Sep 2025

Oct–Dec 2025

6.5%

6.9%

7.1%

5.9%

6.0%

957,000

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