Borrowing Capacity Calculator
Need more than just numbers?
Although this calculator will give you an indication, the finer details could mean thousands of dollars difference a year on your loan– please just get in touch to understand a potential loan in more detail. We're here to help.
What is a Borrowing Capacity Calculator?
A Borrowing Capacity Calculator is an online tool that helps estimate how much you may be able to borrow for a home loan based on factors such as your income, expenses, debts, and financial commitments. It provides an approximate borrowing amount but does not guarantee loan approval.
How accurate is a Borrowing Capacity Calculator?
While a Borrowing Capacity Calculator provides a useful estimate, it does not replace a formal loan assessment. Lenders consider additional factors like your credit score, employment history, and loan type. For an accurate assessment, it's best to speak with a mortgage broker like KBF.
What factors affect my borrowing capacity?
Your borrowing capacitydepends on several factors, including:
- Income: Your salary, rental income, or other earnings.
- Expenses: Monthly living costs and financial commitments.
- Existing Debts: Credit cards, personal loans, or car loans.
- Interest Rates: Higher rates can reduce your borrowing capacity.
- Loan Term: Longer terms may allow for higher borrowing amounts.
How can I increase my borrowing capacity?
To improve your borrowing capacity, you can:
- Reduce existing debt (e.g., pay off credit cards and personal loans).
- Increase your income through a raise, side hustle, or rental income.
- Lower your expenses by budgeting effectively.
- Improve your credit score by paying bills on time and limiting new credit applications.
- Opt for a longer loan term if suitable for your situation.