How to improve your borrowing capacity

Clean up unsecured debt, manage credit cards (the limit matters more than the balance), and consider a partner co-applicant. Three levers that move the calculator more than rate-shopping.

10 min readBy Daniel WongStage 5 of 6

A $20,000 credit card limit reduces your borrowing capacity by ~$80,000, even if the balance is zero.

Three levers worth pulling

Reduce credit card limits before applying. Pay down or pause Buy Now Pay Later. Consider a partner co-applicant if their income is stable PAYG, since lenders treat PAYG income very differently to self-employed income.

Borrowing power calculator

Borrowing power

Borrowing Power Calculator

Estimate how much you could borrow based on your income, expenses and household.

Applying

Annual income (before tax)$100,000

$30,000$500,000

Monthly living expenses$2,000

$500$10,000

Existing monthly debt repayments$500

$0$5,000

Number of dependents0

Indicative borrowing power

$452,000

Up to $483,000 if the lower end of our HEM estimate applies. Indicative only: after-tax income, the higher of your expenses and our HEM estimate, and a 6.2 per cent rate tested at 9.2 per cent over 30 years. Lenders add their own margins and policy on income type and credit history. Full calculator

Find me a vetted broker

Estimate only. Lender assessment depends on full income/expense picture and credit file.

Want a richer scenario? Open the full borrowing power calculator

From the rest of the site

WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Comparison rates are calculated on a secured loan of $150,000 over 25 years for home loans and a loan of $30,000 over 5 years for car and personal loans, unless the lender states another basis. Business loans and equipment finance for a business purpose have no mandatory comparison rate.