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.

Annual income (before tax)$100,000

$30,000$500,000

Monthly expenses$2,000

$500$10,000

Existing monthly debt repayments$500

$0$5,000

Number of dependents0

Indicative borrowing power

Indicative only, at a 6.5 per cent rate over 30 years. Actual capacity moves materially with lender policy on income type, dependants and credit history.

Get pre-approved

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

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From the rest of the site

WARNING: This comparison rate is true only for the example 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 based on a secured loan of $30,000 over 5 years for vehicle finance and $50,000 over 5 years for equipment finance, as required under the National Credit Code.