Calculator
A serviceability-style estimate: shaded income, a benchmark living expense figure, contracted debt repayments and an assessment rate buffer - with the full working shown.
Variable and rental income are shaded, not counted in full. Shading percentages are lender-dependent - adjust them to the lender you have in mind.
Living expenses are benchmarked using a HEM-style table by household size and location band. Lenders use the higher of your declared expenses and the benchmark.
Enter contracted repayments from your loan statements, not estimated minimums.
The assessment rate is the greater of your product rate plus the buffer, or the lender's floor rate. Both are configurable because they change with lender policy and APRA/ASIC guidance.
Check these inputs before relying on the result
Important
These results are estimates for general informational purposes only. They are not a loan approval, a formal quote, or an offer of credit, and they are subject to individual lender assessment, verification of your income, expenses and credit history, and current lender policy. This is not personal financial or credit advice and does not take your objectives or circumstances into account.
Interest rates and comparison rates vary by lender, loan purpose, LVR and your individual circumstances, and can change at any time. Any rate used here is the figure you entered, not a rate offer.
Income shading, living expense benchmarks and buffer settings are lender-dependent and shown indicatively. Every lender applies its own policy, verifies your expenses against statements and may reach a materially different number.
Australian lenders do not test your repayments at the rate you will pay. Under APG 223 guidance they add a serviceability buffer - commonly 3.00% - to the product rate, and apply a floor rate if the buffered figure is still too low.
A loan advertised at 6.09% is therefore usually assessed near 9.09%. That single rule is the main reason a bank's own online calculator and its credit decision can disagree by six figures.
Not all income counts in full. Overtime, bonuses, commission and rental income are typically shaded to 80% (sometimes 70-90% depending on lender and industry), while base PAYG salary counts at 100%.
Living expenses are taken as the higher of what you declare and the Household Expenditure Measure benchmark for your household size, income and location - so understating your spending does not increase your capacity.
Credit cards are assessed on the limit, not the balance, usually at around 3.8% of the limit per month. A $20,000 unused limit can cut borrowing power by roughly $80,000-$100,000.
Personal loans, car loans, buy-now-pay-later plans, HECS-HELP repayments and child support all reduce the monthly surplus that is converted back into a loan amount.
Once lenders subtract assessed expenses and commitments from shaded income, the remaining monthly surplus is converted into a loan size using the standard annuity formula over the loan term at the assessment rate.
Because the conversion is exponential, small changes matter: clearing a $500 monthly commitment can add well over $70,000 to what you can borrow on a 30-year term.
$110,000 base salary, no dependants, a $10,000 credit card limit and no other debts, buying an owner-occupied home over 30 years.
Closing an unused card before applying added roughly $45,000 of capacity without earning a dollar more.
$95,000 and $72,000 salaries, one child, a $480 per month car loan, declared living expenses below the HEM benchmark.
The lender used the higher HEM figure, so the realistic budget was $735,000 - not the $820,000 a generic online tool suggested.
Most public calculators skip the 3% serviceability buffer, HEM expense benchmarks and credit card limit loadings. Our calculator applies all three, which is why the result is usually more conservative - and closer to what a credit assessor will approve.
A lot. Shading of bonus and rental income, HEM tables, buffer floors and treatment of HECS debt all vary. Across a panel of 50+ lenders the same applicant can see a spread of $100,000-$250,000 in maximum loan size.
Yes. Compulsory repayments are treated as an ongoing commitment. Some lenders will disregard it if the balance will be cleared within about 12 months, which can be worth tens of thousands of dollars in capacity.
Yes, and it is assessed on the approved limit. Reducing or closing limits you do not use is usually the fastest way to lift borrowing power before applying.
Treat it as a snapshot. Rate movements, policy changes, a new car loan or a change in income can shift it within weeks, so it is worth re-running before you bid or sign.
Every lender reads these numbers differently. Book a free 30-minute call and we'll check your figures against real lender policy.
Borrowing power is only one part of the picture - check the repayments, the upfront costs and the deposit gap too.
A free, no-obligation 30-minute call is usually enough to know exactly where you stand and what to do next.
