Mortgages
How much can I borrow for a home?
Borrowing capacity is shaped by income, expenses, existing debts and lender policy. Here is how the pieces fit together.
Educational information — not personalised financial advice.
What borrowing capacity actually means
Borrowing capacity is a lender's estimate of how much it is willing to lend you based on its own assessment rules. Two lenders looking at identical information can reach different numbers, because each uses its own expense benchmarks, income treatment and assessment buffers.
The main inputs
Income
Lenders look at how stable and verifiable your income is. Salaried income is usually treated differently from bonuses, overtime, commissions, rental income or self-employed profit.
Living expenses
Lenders compare your declared expenses against a household expenditure benchmark and generally use the higher figure.
Existing debts
Credit cards, personal loans, car finance, buy-now-pay-later facilities and HECS/HELP repayments all reduce capacity. Credit card limits often matter more than balances.
Dependants
More dependants generally means a higher assumed cost of living.
Assessment rate
Lenders do not assess your repayments at the advertised rate. They add a buffer so the loan remains serviceable if rates rise.
Why the estimate moves around
Changing the loan term, reducing a credit card limit, paying out a small personal loan or a change in the assessment buffer can each move a borrowing estimate meaningfully.
Next step
Use the Borrowing Power Calculator to see an indicative range, then compare it against the repayments you would actually be comfortable with.
Where this comes from: Written from publicly available Australian lending and government information. Figures change — confirm current details with the relevant lender or government source before relying on them.