Pharmacist home loans: which lenders waive LMI, and how far each goes

Can a pharmacist get an LMI waiver?

Yes. A registered pharmacist can get an LMI waiver at four lender groups. NAB waives lenders mortgage insurance up to 95% of the price for a home to live in and 90% for an investment. Westpac Group (Westpac, St.George, Bank of Melbourne and BankSA) waives it up to 90% if you earn at least $90,000 from your eligible qualifications. Bankwest waives it up to 89.99% on loans up to $2 million, and CommBank up to 89.99% if you earn at least $100,000 gross [1]. Money Brain checked each one against the lender's own policy.

Borrow more than 80% of the price and the lender takes out LMI, insurance that you pay for. LVR, the loan as a share of the property's value, is the number every waiver is written around. On a $760,000 loan at 95% LVR, LMI can run past $34,000 (part 7). The waiver means a pharmacist doesn't pay it.

Is there a pharmacist home loan program in Australia?

There's no single pharmacist home loan program in Australia. A pharmacist home loan is an ordinary home loan with one difference: the lender waives LMI because it treats your profession as low risk. The rate, the repayments and the credit checks are the same kind as any other home loan.

In Australia, the idea is each lender's professional LMI waiver, sometimes called a medico package. Each lender writes its own list of who qualifies, how far it lends and on what terms, and the lists don't agree. That's why this guide compares the lenders side by side.

Do pharmacists get the same LMI waiver as doctors?

Pharmacists get the same waiver as doctors at two of the four lenders, and a narrower one at the other two. NAB lists pharmacists in the same medical practitioners group as GPs, specialists and dentists, so a pharmacist gets NAB's full 95% for a home. Bankwest lists pharmacists among its medical specialities at the same 89.99% as its doctors [1].

Westpac Group puts pharmacists in its second medical group, at 90% with a $90,000 income floor, where its first group takes doctors and dentists to 95% with no minimum income. CommBank lists pharmacists in a section of their own with a $100,000 minimum [1].

What this means for you: if you've read that "medical professionals get 95% with no LMI", that's true for a pharmacist at one lender, NAB. At Westpac Group a pharmacist on less than $90,000 doesn't qualify at all, where a junior doctor would. See home loans for doctors for how the doctors' groups work.

Is there a minimum income for a pharmacist LMI waiver?

Two of the four pharmacist waivers have an income floor. Westpac Group asks for at least $90,000 gross from your eligible qualifications, added up across your jobs if you work more than one. A partner's income doesn't count toward it. CommBank asks a pharmacist for $100,000 gross. NAB and Bankwest set no dollar figure in the policies we hold, though their normal assessment still decides how much you can borrow [1].

What this means for you: a pharmacist on $85,000 clears neither floor, but can still meet NAB's and Bankwest's conditions. On $95,000 you clear Westpac Group's floor but not CommBank's. A pharmacist who works in a hospital and does weekend shifts in a community pharmacy can add both jobs to reach Westpac Group's $90,000.

What the waiver is worth, in dollars

The waiver is worth the LMI you'd otherwise pay. Here's what LMI would cost on a home to live in, from one insurer's published rate card [4]. At any of the four lenders, a pharmacist who meets its terms and borrows about 90% doesn't pay the 90% column. Only at NAB does a pharmacist borrowing 95% skip the 95% column.

Each figure is an illustration from one rate card, not a quote. Your own premium will vary with the insurer, the loan and the lender.

What this means for you: on an $800,000 home, going from 90% to 95% adds about $15,500 of LMI without a waiver, for $40,000 more of borrowing. At NAB that step costs a pharmacist nothing in LMI. At the other three it isn't on offer, so the real choice there is 10% down with no LMI, or 5% down and paying it.

5% or 10% deposit: which lenders fit a pharmacist?

With a 5% deposit, one lender waives LMI for a pharmacist buying a home: NAB. With 10%, four do. That matters because the lender with the waiver isn't always the lender that fits your income, your structure or your plans.

Bankwest's and CommBank's limit is 89.99%, not 90%, so a 10% deposit has to cover the price with a little to spare, before stamp duty and costs. A 10% deposit also lets you choose on the rest of the loan, such as the rate, the features and how the lender reads your pay, rather than on the waiver alone.

How large a loan will a pharmacist waiver cover?

Each lender caps the loan its pharmacist waiver covers, and the caps differ. A pharmacist buying a $3 million home has fewer choices than one buying at $900,000.

What this means for you: above $2 million, Bankwest's limit drops to 84.99%, and it stops at a $3 million loan. NAB's waiver covers a property up to $4.5 million. Westpac Group's and CommBank's pharmacist terms, as we hold them, set no loan size of their own, so for a larger purchase that's a question we put to the lender for you.

Employed, locum or pharmacy owner: how lenders see you

An employed pharmacist, a locum on an ABN and a pharmacy owner are three different applications to a lender, even on the same income. The waiver depends on your registration. What you can borrow depends on how you're paid, and pharmacy uses all three.

What this means for you: two pharmacists in the same shop, filling the same scripts, can get different answers. The one on payroll shows payslips. The one locuming through their own ABN shows tax returns, and if the arrangement is new, there may not be enough of them yet.

Hospital pharmacists: overtime and on-call pay

Westpac Group, NAB and ANZ each count 80% of a pharmacist's overtime unless a special rule lifts it, because overtime can stop. Some lenders count 100% for workers in named essential services, and those lists are written around specific jobs. Westpac Group's, for example, names nurses, midwives, doctors, surgeons and specialists. We hold no lender rule that names pharmacists in them, so plan on 80% unless the lender confirms otherwise [6].

What this means for you: if overtime or on-call pay is a real part of your income, the share counted changes what you can borrow. At 80%, $10,000 of overtime counts as $8,000. NAB averages it over the last 180 days, so a recent run of extra shifts won't count in full straight away.

Salary packaging in a public or not-for-profit hospital

Pharmacists employed by public and not-for-profit hospitals, and by public ambulance services, can package up to $17,000 a year of their pay without fringe benefits tax. At public benevolent institutions and health promotion charities, the cap is $30,000. Both are grossed-up amounts, per employee [8]. The caps follow the employer, not the job, so a community pharmacist's packaging depends on who employs them.

Packaged pay is tax-free, so the same pay can leave you more to repay a loan with. Some lenders count that tax-free part as income in its own right, which can raise what you can borrow. Lenders don't all treat it the same way, and some lenders' packaging rules are written for named health jobs that we haven't confirmed include pharmacists, so they aren't shown here:

What this means for you: two hospital pharmacists on the same pay can get different borrowing answers simply because one lender counts their packaging as tax-free income and another needs paperwork first. Bring your packaging statement along with your payslips.

Locum and contract pharmacists on an ABN

A locum pharmacist paid through their own ABN is usually read as self-employed. So lenders ask for tax returns and notices of assessment rather than payslips, usually two years of them [9][10]. The waiver itself still turns on your registration, not on how you're paid.

The policies we hold for NAB, Westpac Group, Bankwest and CommBank don't say how each treats a self-employed pharmacist for the waiver. St.George's own page says its profession offer can apply to self-employed people in the professions it lists [5], but whether pharmacists are on that list isn't something we've confirmed. So it's settled with the lender before you rely on it.

A pharmacist who has just moved from payroll to locuming can earn the same and borrow less for a while, because the lender now wants self-employed history. If a move like that is coming, it's worth knowing which order to do things in. The full rules are on self-employed home loans.

Can a self-employed pharmacist borrow on one year of tax returns?

Yes, at some lenders, but often only at 80% of the value or less, which is a 20% deposit. Pharmacists are on the short list of professions where one lender asks for less. One lender's credit guidelines let a self-employed pharmacist registered with the Pharmacy Board of Australia use one year of figures instead of two, where the loan is 80% of the value or less and the business has traded for at least 12 months [9]. Its list of 11 professions leaves out physios, chiropractors, paramedics, nurses and dentists.

That same lender accepts a draft tax return if your accountant confirms in writing that it won't change [9]. NAB also considers a single year's financial statements at 80% or less [11].

What this means for you: the one-year routes sit at a 20% deposit, where there is no LMI to waive. A self-employed pharmacist with one year of figures is usually choosing between a bigger deposit now and the waiver once a second year is lodged.

Lenders also set how old your figures can be. MyState doesn't accept tax returns or financials more than 18 months old when you apply, and doesn't take draft returns [12]. Late in a financial year, a pharmacist whose newest return isn't lodged can fall outside a rule like that without noticing.

How add-backs change a pharmacy owner's number

Add-backs can move a pharmacy owner's assessed income by tens of thousands of dollars. An illustration, not a client file, using the rules in part 16. A pharmacy shows a net profit of $200,000. It claimed $60,000 in depreciation on its fit-out and equipment, a one-off legal bill of $5,000, $10,000 of super above the compulsory amount, and $8,000 on advertising.

Depreciation is capped at 20% of $200,000, so $40,000 is added back, not $60,000. The legal bill and the extra super are added back in full. Advertising isn't on either lender's list, so it isn't added back. The income a lender would start from is $255,000, not the $200,000 on the return. Each lender's own list differs, so the real figure depends on which lender you use.

If your income jumped, the year used matters too. At Firstmac, a pharmacist who earned $120,000 one year and $180,000 the next would be assessed on $144,000, which is 120% of the earlier year [10].

Buying into a pharmacy while buying a home

Buying into a pharmacy and buying a home is one decision, not two. Any loan you're personally on for the pharmacy, its stock or its fit-out counts against what you can borrow for the home, and so does a guarantee you sign for the pharmacy's company.

The order matters. Buy the home first and the business lender sees a larger personal debt. Buy into the pharmacy first and the home lender may want to see a full year or more of your new income before it counts it. Work out both loans on one page before you sign either contract.

Business debt you're personally on also counts toward your debt-to-income ratio, which APRA watches closely (part 22).

Intern pharmacists and new graduates

An intern or newly registered pharmacist can get a home loan, and the waiver turns first on registration. None of the four pharmacist policies we hold sets a minimum time since registration. What usually matters is general registration, since an intern pharmacist holds provisional registration, not general, and, at Westpac Group and CommBank, whether your first year's pay clears the floor [1].

Bankwest and NAB set no dollar floor, so a new graduate's pay level doesn't bar the waiver itself there. Every lender still checks that your income carries the repayments.

Lenders also look at time in your current job. At Westpac, a loan without mortgage insurance needs you to have started and been paid at least once. A mortgage-insured loan needs 3 months in the job, or less than that with 12 months in the same occupation and no gap of more than 2 months between jobs [7]. Westpac's policy doesn't say whether a waiver loan counts as "without mortgage insurance" for this rule, so it's a question we put to the lender for you.

Part-time, or on parental leave

An employed pharmacist can buy while working part-time or on parental leave. At Westpac, permanent part-time pay counts as base pay, using the lowest base rate and hours on your payslips unless there's a reason they vary. One-off unpaid leave can be counted back in if you confirm you're back to your normal hours [7].

On leave, Westpac can use your return-to-work pay, base pay only, with a letter from your employer giving your return date, your hours and your pay. Every child counts as a dependant, including one not yet born. If your first repayment falls before you return, you'll need savings that cover the gap, on top of the money for the purchase [7].

Part-time pay can also take you under Westpac Group's $90,000 or CommBank's $100,000 floor, which is where NAB's and Bankwest's waivers matter more (part 6).

How much can a pharmacist borrow?

How much a pharmacist can borrow comes down to three things: what a lender counts of your income, your debts, and your living costs. Banks then check you could still make the repayments if rates were at least 3 percentage points higher, the buffer APRA expects [15].

Your debt-to-income ratio, or DTI, is your total debts as a multiple of your gross income. APRA limits each bank's new home lending to people whose debts are 6 or more times their income to 20% of that lending [15]. Business loans you're personally on count toward it.

What this means for you: a pharmacist earning $110,000 reaches 6 times at $660,000 of debt. That's why the same pharmacist can get quite different answers from two lenders: one that counts your penalties, allowances and packaging in full can lend noticeably more than one that counts part of each. See how much can I borrow.

Buying with a partner who isn't a pharmacist

You can. At Westpac Group, the $90,000 test is on your own pay from your eligible qualifications, so your partner's income doesn't help you reach it [1]. Your partner's income does count toward what you can borrow together.

CommBank's $100,000 is gross income; whether it's tested on you alone on a joint loan isn't set out in the terms we hold. How NAB applies its main-income test on a joint loan isn't set out either, so both are ones we confirm for you. At ANZ, if the loan has LMI and you're casual, you can't be the only or main earner [6].

Do pharmacists get cheaper home loan rates?

Money Brain doesn't print a pharmacist interest rate, because none of the waiver policies we hold sets one. The pharmacist waivers set the deposit, the limits and who qualifies; the rate is priced loan by loan [1].

Rates change far more often than waiver policies. The useful comparison is the total cost of the loan, LMI included, at each lender that takes you, on your loan, at your LVR, on the day you apply.

Can a pharmacist waiver loan be interest-only?

Only on terms. Bankwest's and CommBank's pharmacist waivers are principal and interest only. Westpac Group's is written for principal and interest too, though its policy allows interest-only that converts to principal and interest at the same 90% [1]. NAB's conditions, as we hold them, don't set a repayment type, so it's one to confirm.

Interest-only lowers repayments for a while and suits some investment plans. It also means the loan doesn't fall while you pay it. See interest only or principal and interest.

Buying an investment property as a pharmacist

A pharmacist waiver can carry over to an investment loan at some lenders. NAB goes to 90% on an investment, against 95% for a home. Bankwest applies the same limits to an investment as to a home. Westpac Group's 90% policy doesn't split a home from an investment [1], and St.George's own page says its offer for the professions it lists can apply whether you're buying to live in or to invest [5].

CommBank's pharmacist terms, as we hold them, don't say how they apply to an investment, so it's one to confirm. Bank First's waiver is for first home buyers only [3]. Equity in a home you own can fund the next purchase. See using equity to buy an investment property.

Pharmacist first home buyer? The waiver, the 5% Deposit Scheme or Help to Buy

A pharmacist buying a first home has two ways to buy with 5% and no LMI, and they suit different buyers. The waiver is a lender's own policy. The 5% Deposit Scheme is the government guaranteeing the lender in place of LMI, and it has no job test [13].

What this means for you: a pharmacist buying under the area's price cap with 5% saved can use the scheme at any lender on its panel, not only NAB, and with no income floor. A pharmacist buying above the cap, or planning to rent the home out later, may find the waiver the better fit.

Help to Buy, where the government takes a share of the home's value so you borrow less, needs a deposit of at least 2% and is open only on incomes up to $103,000 alone or $165,000 together. It can't be used with the 5% Deposit Scheme [13][14]. See the 5% Deposit Scheme, Help to Buy, guarantor home loans and the first home buyer grants in your state.

Overseas-trained pharmacists and visa holders

If you're registered with AHPRA and working as a pharmacist here, the same waiver terms apply; NAB's and CommBank's waivers depend on that registration [1]. What changes is your visa: many lenders treat permanent residents like citizens and ask more of temporary visa holders. See home loans for visa holders.

What does a broker cost you?

How a broker is paid, and the rule Money Brain holds against it, is set out in full on its own page: what a mortgage broker costs.

Your first move

You've read the rules. Now there's one question left: which of the four lenders, for the way you're paid, at the price you want? That depends on your registration, your pay, your structure and your deposit, and it's what Money Brain works out before anything goes to a lender.

When you're ready, the closing section below is the simplest way to start.