ING Tightens Investor Loan Rules Ahead of 2027 Tax Changes

ING Bank Australia has updated how it assesses negative gearing for investor loans, with the changes taking effect immediately from 12 June 2026.

ING Bank Australia has updated its serviceability assessment for investor home loan applications, with the changes taking effect from 12 June 2026. As MPA Australia reports, the move follows the federal government's 2026–27 Budget announcement on 12 May 2026, which proposed restricting negative gearing to new residential builds from 1 July 2027. That legislation has not yet passed, but ING — along with a growing list of lenders — has moved ahead of the law to revise its investor lending policies now.

ING joins CBA, ANZ, NAB, Macquarie, and Suncorp, all of which have tightened their investor serviceability policies since the May budget announcement.

What Has Changed and Why It Matters

Negative gearing has historically been factored into investor loan serviceability as a way of increasing borrowing capacity. Under previous policy settings, lenders could include the expected tax benefit of negative gearing as a form of additional income — effectively boosting how much an investor could borrow before filing a single tax return.

With the government proposing to remove that benefit for established residential properties from July 2027, lenders are revising their serviceability calculations now to reflect the environment borrowers will face over the life of their loans. A survey of almost 200 brokers found 85% expect the budget changes to impact property prices — a measure of how widely the flow-on effect is anticipated across the market.

The removal of negative gearing from serviceability calculations could reduce borrowing power by as much as 20% in some cases, according to analysis cited by Australian Broker. For investors who were relying on that buffer to qualify for a particular loan amount, that is a substantial reduction.

ING's revised policy uses **12 May 2026** as the key dividing line:

- **Properties purchased on or before 12 May 2026:** negative gearing continues to be factored into serviceability as before. Existing investors who settled before that date are unaffected. - **Established residential properties purchased after 12 May 2026:** interest expense deductions are now capped at rental income for serviceability purposes. The negative gearing benefit is no longer counted. - **New builds:** full negative gearing treatment is retained regardless of purchase date, provided the property meets the federal government's definition of a new build as outlined in the Federal Budget Tax Explainer.

In-Flight Applications: What Needs to Be Checked Now

MPA Australia sets out specific transitional rules for applications already in progress, and the details have real implications for deals currently moving through the pipeline.

**Pre-approval conversions:** loans converting from a pre-approval will be assessed under the updated rules where the property meets the new policy criteria. Investors who received pre-approval before 12 May should not assume they are protected — serviceability will be recalculated.

**Minor administrative changes:** conditional or unconditional approvals resubmitted for minor administrative changes — such as correcting a spelling error — on or before **12 July 2026** will not be reassessed retrospectively. The original approval stands.

The same minor administrative changes submitted **after 12 July 2026** will be assessed under the new policy. That date is a hard cut-off for preserving an existing approval on minor paperwork.

**Material changes:** any resubmission involving a material change — including loan amount, repayment type, or security — triggers a full reassessment under the updated rules regardless of timing.

Brokers should audit every in-flight investor application immediately: confirm the contract date against the 12 May cut-off, establish whether each property qualifies as a new build under the government's definition, and flag any files approaching the 12 July deadline for minor administrative work before they are caught by the updated rules.

**Mixed investment portfolios** require additional attention. Where a client holds a mix of eligible and ineligible properties, ING will assess the total portfolio on a pooled basis. If total interest expense across the portfolio exceeds total rental income after income shading, the negative gearing benefit is capped at rental income across the whole portfolio. Brokers should model the full portfolio position — not just individual properties — before resubmitting any application.

ING has confirmed its online serviceability calculator is being updated. The bank will advise once the new tool is live. Until then, brokers should not rely on the existing calculator for investor applications.

What This Means for Investor Borrowers

If you are considering purchasing an established residential investment property, your borrowing capacity under ING's new settings — and those of most other major lenders — has changed since the May budget. Reviewing your figures before committing to a purchase is essential, particularly if your serviceability was previously close to the limit or relied on negative gearing income being counted.

If you are purchasing a new build, full negative gearing treatment is retained under ING's policy, which is one reason new construction is becoming an increasingly important part of the investor equation as lenders continue to align with the proposed legislation.

For investors already holding property and considering refinancing, the policy changes affect how lenders assess your overall portfolio, not just the loan you are seeking to refinance. Getting accurate modelling across your full position before any application is the right starting point.

Explore [investor home loan options](/home-loans/investor) to compare lenders and their current serviceability approaches, or use our [borrowing power calculator](/calculators/borrowing-power) to see how the new settings affect your position. If refinancing is on the table, our [home loan refinance options](/home-loans/refinance) cover lenders across the market to help identify where the most competitive terms are available for your circumstances.

[Source: MPA Australia](https://www.mpamag.com/au/news/general/ing-updates-negative-gearing-serviceability-rules-for-investor-loans/578715)