Calculator · Borrowing power Borrowing power calculator
An estimate of what lenders could lend you, worked out the way they do it: your income after tax, living costs, card limits and other debts, tested at your rate plus a 3% buffer. Every assumption is shown below.
You could borrow about
$968,000
- Take-home pay each month
- $13,480
- Living costs (estimate)
- $4,900
- Card limits, as lenders count them
- $382
- Other repayments
- $0
- Left to service a loan
- $8,198
- Tested at
- 9.00% over 30 years
An estimate, not an offer or a pre-approval. Lenders use their own living cost benchmarks and income rules, so their numbers differ. Living costs here use a HEM-style estimate, not the licensed HEM table, or your own figure if it’s higher.
The assumptions, in full
- Tax: 2026–27 resident income tax, Medicare levy and the low income tax offset. HELP repayments if ticked.
- Living costs: a HEM-style estimate by household, income, state and location, or your own figure if it’s higher. Lenders use the higher of the two as well. The estimate is checked each quarter against the serviceability calculator I use, and set to land at or a little below it.
- Held back: 5% of what’s left each month, before it’s turned into a loan amount.
- Card limits: 3.8% of the total limit each month, whatever the balance.
- Other income: 80% counted, as many lenders shade rent and bonuses.
- Buffer: your rate plus 3%, over 30 years, principal and interest.
What changes your borrowing power most
- Card limits. Cutting a $20,000 limit you don’t use can add more than you’d expect.
- Other debts. A car or personal loan repayment comes straight off what you can service.
- How your income is counted. Bonuses, overtime, allowances and business income are read differently by each lender.
- The lender. Benchmarks and buffers differ, so the same household can get very different answers.
Self-employed? Lenders rebuild your income from your tax returns. See how lenders assess self-employed income.
FAQ Questions clients ask
How much can I borrow for a home loan?
Lenders work it out from your income after tax, minus living costs, card limits and other repayments, then test the loan at your rate plus a buffer of about 3%. On two incomes of $120,000 and $90,000 with a $10,000 card limit, this calculator estimates about $968,000 at an illustrative 6%. Each lender’s own number will differ.
Why do lenders add 3% to the interest rate?
APRA, the banking regulator, expects lenders to check you could still repay if rates rose by about 3 percentage points. So a lender testing a 6% loan assesses it at about 9%, which lowers what you can borrow.
Do credit card limits affect my borrowing power?
Yes, even with a zero balance. Lenders assume the whole limit could be used and count a monthly repayment on it, commonly about 3.8% of the limit. A $10,000 limit can cost tens of thousands in borrowing power.
Why is my bank’s number different?
Every lender uses its own living cost benchmarks, buffers and income rules: how it counts bonuses, overtime, rental or business income. That’s why two lenders can be well apart on the same income, and why I compare lenders’ calculators, not just their rates.
Does a HECS or HELP debt reduce my borrowing power?
Usually, yes. Lenders count the compulsory HELP repayment as a reduction in your take-home pay, which lowers what you can borrow. Tick the HELP box for each applicant who has one.
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