Mortgage Repayment Calculator
Estimate monthly repayments by loan amount, term, and interest rate.
Borrowing Power Estimator
How much could you borrow? This estimate uses standard serviceability math: surplus income, a stress-tested rate (APRA buffer +3.0%), and a comfort margin you can dial in.
Income & expenses
Loan assumptions
Estimated maximum loan
$437,597
With your $150,000 deposit, that targets a property up to $587,597.
Monthly surplus
$4,500
Sustainable repayment
$3,600
Stress rate
9.25%
About this calculator
This is a rough guide, not a loan pre-approval. Banks use their own serviceability models (HEM expense floors, credit-card limit uplifts, shaded rental income, dependant adjustments) that are stricter than this estimate. Talk to a licensed mortgage broker for a real assessment.
How this borrowing power calculator works
The estimator works in two stages. First, it computes monthly disposable income: gross income, minus tax (PAYG brackets), minus committed living expenses (using the HIGHER of declared expenses or HEM), minus existing loan repayments at the buffered rate. Second, it back-solves for the maximum principal a bank could lend such that the monthly repayment at the buffered rate (current rate + 3pp APRA buffer) equals that disposable income.
Why the buffer matters. The 3pp APRA serviceability buffer is the single biggest constraint on how much most Australians can borrow. Lower rates increase borrowing capacity rapidly because the buffer is additive, not proportional. A drop from 6.20% to 5.20% cuts the assessment rate from 9.20% to 8.20% — a 12% reduction in the rate that matters for serviceability.
For deeper reading, see the APRA serviceability buffer explained and borrowing power vs serviceability.
Frequently asked questions
What is the APRA serviceability buffer?
APRA requires Authorised Deposit-taking Institutions (banks) to assess loan serviceability at the customer's actual rate plus a buffer (currently 3 percentage points). So if you're applying for a loan at 6.20%, the bank checks you can afford the repayments at 9.20%. This is the single biggest reason borrowing capacity dropped 25-30% during the 2022-2024 rate cycle.
What's HEM and why does it matter?
Household Expenditure Measure — a benchmark of typical household living expenses based on income and household composition. Most lenders use the HIGHER of HEM or your declared expenses for serviceability. Declaring expenses lower than HEM doesn't help — the bank uses HEM anyway. Declaring expenses higher than HEM does count against you.
Does this match what a bank will actually lend me?
Close, but every lender has slightly different policy (LVR caps, additional buffers for investment loans, gendered policy for child-related expenses, treatment of variable income). Treat the figure as a ballpark for pre-shortlisting; the formal pre-approval is what binds.
How is borrowing power affected if I have an existing loan?
Existing loan repayments are deducted from disposable income at the buffered rate, not the actual rate. A $200/week existing repayment at 6% becomes a ~$240/week deduction at the 9% buffered rate. This dramatically reduces borrowing capacity for portfolio investors.
Why is investor borrowing capacity lower?
Some lenders apply an additional buffer for investment loans (often +0.5pp on top of the 3pp APRA buffer) and discount rental income at 70-80% (to allow for vacancy and management fees). Both reduce the borrowing capacity vs an owner-occupier with the same gross income.