Borrowing Power Calculator

Want to find out much you can borrow for a home loan? Our borrowing power calculator gives you an initial estimate of what a lender may be willing to lend you based on your income and expenditure.

Salary
$
Other Income
$
Partner's Salary
$
Partner's Other Income
$
Dependants
Household Living Expenses
$
Other Loan Repayments
(e.g. car loan, credit card, personal loan, etc...)
$
Interest Rate
%
Loan Term (max. 30 years)
years

You can borrow up to $ 0.00

Your monthly repayment would be $ 0.00

Total interest paid $ 0.00

Total cost $ 0.00

Summary
Your Total Salary & Other Income
$ 0.00
Dependants
0
Total Monthly Expense
$ 0.00
Interest Rate
0.00 %
Loan Terms
30 years
Amount to Borrow
$ 0.00
Monthly Repayment
$ 0.00
Total Interest Paid
$ 0.00
Total Cost
$ 0.00

How to use our borrowing power calculator

Your Mortgage’s borrowing power calculator considers a few important factors that can determine your borrowing capacity, or how much you would be eligible to take out on a home loan. If you’re not sure, just put an estimate.

There are three parts to this calculator: Annual income, monthly expenses and loan details.

  • Annual income. The calculator will ask you to provide all your income streams including your net salary before tax, rental income, and any other regular sources of income.

  • Monthly expenses. You’ll need to enter your overall day-to-day expenses, existing loan repayments and any other financial commitments such as insurance, additional superannuation contributions, and the combined limit of your credit cards and overdrafts.

  • Loan details. Lastly you’ll need to fill in the details of your loan including the interest rate and the loan term. Take note the calculator will estimate your borrowing power based on a fixed interest rate over a loan term.

How much can I borrow?

Your income, expenses and deposit are the biggest factors determining your borrowing power, but lenders also consider other factors such as your existing debts and if you are using a guarantor for the loan.

Our borrowing power calculator asks you to enter details including your loan term and interest rate, income and expenses, and any outstanding debts and credit card limits.

Here’s how these factors can impact your borrowing capacity.

How the interest rate and loan term can impact your borrowing power

Changing the interest rate and loan term can have a significant impact on your borrowing power.

The lower the interest rate, the higher your borrowing capacity as the total amount of interest applicable to the entire life of the loan will be lower – assuming interest rates do not change.

If the loan term is shortened, this will decrease the amount of interest you will be charged over the entire life of the loan. This means your monthly repayments will predominantly pay down the principal amount of the loan, however the monthly repayments will be substantially higher as a result.

It’s important to note the calculator assumes a fixed rate for the entire life of the loan. The calculator also doesn't factor in interest rate fluctuations.

How your income and expenses can impact your borrowing power

The more income you can prove you earn to a lender, the greater your borrowing capacity is likely to be.

Consequently, the likelihood of being issued with a home loan becomes more attainable — especially if your expenses or debts are well covered by your income.

Sometimes, high-income earners may be surprised to learn their borrowing capacity is low because they have a lot of financial commitments leaving them with little disposable income, which can give lenders a reason to reduce the amount they are willing to lend.

On the other end of the spectrum are your expenses. If your expenses are higher than your income, the lower your borrowing capacity will be as the lender will view you as being unable to manage home loan repayments.

Banks and lenders are ultimately trying to assess you as a credit risk. If your expenses outweigh your income, regardless of how much you earn, then the lender perceives you as ‘high risk’.

How your existing credit card and overdraft limit can impact your borrowing power

Lenders will consider any credit cards to be drawn to their full limit even if you have never exceeded the allocated credit limit or found yourself behind repayments. For example, if you have one credit card with a $10,000 limit and another with a $3,000 limit, the lender will write down a $13,000 debt against you.

This is why it’s important to close any unused credit cards or reduce the credit limit on cards you’re currently using.

It’s also important to tackle any outstanding credit card or other high-interest debts before applying for a home loan. Any red flags on your credit history can pose the risk of the lender denying your application.

Can I increase my borrowing power?

It’s generally not recommended to borrow more than you can comfortably afford because you don’t want to overstretch yourself and struggle to meet your repayments. However, the amount you can borrow may differ from lender to lender so it can be worth boosting your borrower power.

Here are some ways to do that:

  • Save a bigger deposit. The bigger your deposit is, the bigger your borrowing power as lenders look for a consistent record of savings. A bigger deposit also reduces your monthly repayments and interest.

  • Pay off your debts. Debts reduce your borrowing capacity particularly if they’re high-interest debts like credit card or personal loan debt. If you can show that you pay your credit card off in full every month, this will work in your favour when lenders look at your credit history.

  • Enquire with different lenders. Each lender will have their own idea of how much they’re willing to lend you based on their own criteria and methods of calculation. This is why it’s a good idea to enquire with different lenders to see what the difference is, at it can sometimes be quite substantial.

  • Reduce your spending. Trimming your spending for a few months will help you save for a bigger deposit and increase your borrowing power. Draw up a budget and consider where you can cut back - shop around for a cheaper phone and internet plan, cancel your gym membership, stop eating out and cook all your meals at home instead, and so on.

  • Reduce your excess credit limits. Cancel any unused credit cards and reduce the credit limit on any cards you are currently using as lenders will consider any credit cards to be drawn to their full limit. For example, if you have a credit card with a $10,000 limit and another with a $3,000 limit, the lender will write down a $13,000 debt against you.

  • Increase your income. Increasing your income is a great way to boost your borrowing capacity. Consider whether you can take on extra shifts at work, get a second job, or consider your ability to get promoted in your current workplace and negotiate for a pay rise.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
VariableMore details
FREE REDRAW FACILITY
  • Application completely online
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
FREE REDRAW FACILITY
VariableMore details
100% FULL OFFSET ACCOUNT

Offset Package Home Loan (Principal and Interest) (LVR < 60%)

100% FULL OFFSET ACCOUNT
VariableMore details
NO ONGOING FEES

Budget Home Loan (Principal and Interest) (LVR < 80%)

NO ONGOING FEES
VariableMore details
FREE REDRAW FACILITY

Basic Home Loan (Principal and Interest) (LVR 70%-80%)

FREE REDRAW FACILITY

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of January 27, 2022.

Frequently Asked Questions

‘Borrowing power’ is a term lenders use to describe how much you may be able to borrow for a home loan, depending on your financial situation. Things that can impact your borrowing power include your income, expenses, debts, and how much deposit you have saved.

The number of dependents you support factors into your borrowing power because they are an ongoing expense that plays into what you can afford to repay on a home loan over the long term.

While lenders generally all use the same basic method, each lender has its own way of calculating your expenses and borrowing capacity based on their appetite for risk, which is why your borrowing power may differ from lender to lender. Unfortunately, lenders don’t make their borrowing power calculation methods public knowledge.

Your credit history isn’t generally included in borrowing power calculations but your history of repayments is something a lender will look at when assessing your home loan application, so it’s important to check your credit score before applying for a loan.