Borrowing Power Calculator

Borrowing power is the amount a lender may allow you to borrow based on your income, expenses and financial position. Understanding your borrowing power helps you work out your home loan budget and how much you may be able to spend on a property.

Using the borrowing power calculator is an easy way to estimate how much you could borrow and what your home loan repayments might be. Enter your income and expenses, and the calculator will provide an estimate based on the current variable interest rate.

How is borrowing power determined?

Lenders calculate borrowing power by assessing your ability to meet home loan repayments over the full loan term. This includes reviewing your income, living expenses, current debts, credit history, and the interest rate applied to the loan.

The loans.com.au borrowing power calculator uses your financial details to estimate how much you may be able to borrow for a home loan. This gives you a helpful starting point before you apply.

How to strengthen your borrowing power

Here are common ways to strengthen your loan application and borrowing power:

Check your credit score

Knowing your credit score helps you understand your financial health and identify areas to improve. You can check your credit score through several Australian providers.

Pay down existing debts

High interest debts such as credit cards and personal loans reduce your borrowing capacity. Reducing these balances can increase the amount you may be able to borrow.

Lower your credit card limits

Lenders assess your credit limits as if they are fully used. Reducing or cancelling unused cards can improve your assessment.

Keep your financial records organised

Having up to date tax returns, payslips and financial documents help lenders assess your situation quickly and accurately.

Save a larger deposit

A consistent savings history can strengthen your application. A bigger deposit can also reduce your repayments and the total interest you pay.

Review your living expenses

Lenders consider your regular expenses such as rent, bills, and childcare. Reducing these costs may help increase borrowing power.

Consider a joint application

A joint application with a partner or co- borrower can increase combined income and may lift your borrowing capacity.

Consider a longer loan term

Choosing a longer home loan term may reduce your monthly repayments, which can increase the amount a lender may allow you to borrow. The tradeoff is that you pay more interest over time.

How to use the borrowing power calculator

To get the most accurate estimate, enter the following details:

• Gross annual income
• Rental income, if applicable
• Monthly living expenses
• Monthly loan repayments

Based on this information, our borrowing power calculator will determine an estimate of how much you could borrow and what your repayments may be based on the current variable interest rate.