Borrowing power calculator
Estimate how much you could borrow from your income, expenses and debts — assessed with a 3% serviceability buffer, the way a lender would.
Educational estimate — not a credit assessment. Real borrowing power depends on each lender's income shading, expense benchmarks, serviceability buffer and credit policy, plus your full financial position. Figures here use a transparent model with a 3% assessment buffer and a HEM-style expense floor, and your actual approved amount will differ. Speak to a lender or mortgage broker before you rely on a number. Propact does not provide financial, legal or tax advice.
How lenders size your loan
A lender starts with your net surplus — take-home income minus living expenses, existing loan repayments and a slice of your credit-card limits. They then find the largest loan whose monthly repayment that surplus can cover.
The catch is they test the repayment at your rate plus a buffer (around 3%), so the amount you can borrow is lower than your actual rate alone would suggest — and it falls as rates rise.
Levers that move the number
Three things shift borrowing power most: your income, your declared living expenses (a HEM benchmark applies as a floor), and your debts and card limits. Closing an unused credit card can lift your borrowing power more than people expect.
Buying with a partner or co-owner pools income — one reason co-ownership is growing. Once you own together, the harder part is tracking who paid what; that's what Propact is for.
Borrowing power — common questions
How is borrowing power calculated?
A lender estimates your surplus income — take-home pay minus living expenses, existing debts and a portion of your credit-card limits — then works out the biggest loan whose repayments that surplus could service. Crucially, they test the repayment at your rate plus a buffer, not your actual rate.
What is the serviceability buffer?
APRA expects lenders to assess your repayments at an interest rate around 3 percentage points above the actual rate, so you could still cope if rates rise. This calculator uses a 3% buffer by default, which is why the assessed rate is higher than the rate you enter.
What is the HEM benchmark?
The Household Expenditure Measure (HEM) is a benchmark of typical living costs that lenders use as a floor when your declared expenses look low. If you leave living expenses blank, this tool applies a HEM-style benchmark scaled for your household and dependants.
Why do credit-card limits reduce my borrowing power?
Lenders treat your total card limit as potential debt — typically imputing a monthly commitment of around 3.8% of the limit — even if you pay the balance in full. Lowering or closing unused cards can lift how much you can borrow.
Is this borrowing power calculator accurate?
It’s an educational estimate, not a credit assessment. Every lender uses its own income shading, expense benchmarks, buffer and policy, so your actual approved amount will differ. Use this to understand the levers, then speak to a lender or mortgage broker.
Buying with someone else?
Propact tracks who paid what, splits the mortgage, and works out a fair buyout — from settlement to the day someone exits.
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