Borrowing Power Calculator
How much could you actually borrow?
The number your bank gives you is not always the whole story. Use this borrowing power calculator to get a starting estimate based on your income and expenses, then book a call to see what is genuinely possible for your situation.
How does it work?
A borrowing power calculator estimates the maximum loan amount a lender might offer you based on your income, existing debts and living expenses. It applies a buffer on top of the current interest rate (as required by Australian lending standards) and works out what you could comfortably repay. The result is a guide, not a guarantee, because every lender calculates it slightly differently. But it gives you a useful ballpark before you speak to anyone.
The calculator has been provided in good faith as a guidance tool only. Results are not financial advice, are a guide only, and are not a guaranteed outcome or quote. Borrowers should always discuss their individual situation with an Australian Credit Licensee or authorised Credit Representative.
What actually determines how much you can borrow?
Your borrowing power is not just about your salary. Here are the factors lenders look at most closely:
Your income
Salary and wages are the starting point. Lenders also consider other income like rental income, bonuses, and overtime, though these are often assessed more conservatively than base salary.
Your living expenses
Lenders estimate your monthly costs and deduct these from your income to work out what is left for repayments. The higher your assessed expenses, the lower your borrowing power.
Your existing debts and commitments
Credit card limits (not just balances), personal loans, car loans, HECS debt, and buy now pay later accounts all reduce your borrowing power. Even a credit card you never use counts against you if the limit is high.
The interest rate buffer
Lenders are required by APRA (the banking regulator) to assess your ability to repay at a rate higher than the actual loan rate. This buffer protects you if rates rise. It means your borrowing power is typically lower than a simple repayment calculation at today's rate would suggest.
The number of people on the loan
Two incomes generally support more borrowing than one, but two people also come with higher combined living expenses, so it is not a simple doubling.
Simple things that can increase your borrowing power before you apply
• Reduce or close unused credit card limits. Lenders assess the limit, not just the balance.
• Pay down or close buy now pay later accounts like Afterpay and Zip, even if you rarely use them.
• Clear small personal loans or consolidate debts where possible before applying.
• Keep a consistent savings pattern for at least 3 months before applying.
• Avoid making multiple credit applications in a short period as each one leaves a mark on your credit file.
• If you are self-employed, make sure your last two tax returns accurately reflect your income, as lenders use these to assess serviceability.
Borrowing power questions we get asked a lot:
-
Every lender uses its own calculation. Different living expense benchmarks, different income treatment, and different buffers all produce different results. A broker can tell you how your situation is likely to be assessed across multiple lenders, not just one.
-
In some cases, yes. A guarantor (usually a parent) who offers part of their own property as additional security can support a larger loan or remove the need for LMI. It is a significant commitment for the guarantor and worth understanding fully before pursuing.
-
Yes. When interest rates rise, the buffer lenders apply also rises, which generally reduces your borrowing power. When rates fall, borrowing power typically increases. This is one reason your borrowing power today may look different to what it was 12 months ago.
-
Using a calculator like this one does not affect your credit score at all. A credit enquiry only occurs when a formal loan application is lodged. We are always careful about this and will talk you through it before lodging anything.
-
This is very common and there are often levers you can pull. Reducing credit card limits, paying down debts, and adjusting your expense profile can all make a meaningful difference. A call is the best way to understand what is dragging your number down and how to address it.
Want to know your real borrowing power?
A calculator gives you a starting point. A discovery call is the first step to give you the real picture, including which lenders will suit your situation and what you can do to improve your number.