Quick answer: lenders work out how much you can borrow from your income, debts, living expenses and dependants, tested at your interest rate plus a 3% buffer. On our estimate at a 6.45% rate, a single person on $100,000 with no debts can borrow about $470,000, and a couple on $100,000 each about $1.1 million. Every 0.25% rate rise trims that by roughly 2%, and every $10,000 of credit card limit by about $45,000. Results vary by lender.
“How much can I borrow?” is usually the very first question, and the honest answer is that it depends on more than your salary. We regularly see two people on the same income get loan offers tens of thousands of dollars apart. Here is what lenders actually look at, worked examples, what a rate rise does, and the levers that lift your number.
How much you can borrow: worked examples
| Household (income before tax) | Estimated borrowing | After a 0.25% rate rise | With a $10,000 credit card limit |
|---|---|---|---|
| Single, $80,000 | about $335,000 | about $5,000 less | about $45,000 less |
| Single, $100,000 | about $470,000 | about $10,000 less | about $45,000 less |
| Single, $120,000 | about $605,000 | about $15,000 less | about $45,000 less |
| Couple, $75,000 each | about $760,000 | about $15,000 less | about $45,000 less |
| Couple, $100,000 each | about $1,100,000 | about $25,000 less | about $45,000 less |
| Couple, $100,000 each, 2 children | about $1,000,000 | about $20,000 less | about $45,000 less |
Our estimate using the same method as our borrowing power estimator: 2026–27 tax rates and Medicare levy, typical living expense benchmarks, a 6.45% rate assessed at 9.45% (rate plus 3%), 30-year principal and interest. Lenders use their own rules, so treat these as a guide, not an offer.
What lenders look at
- Income, and the type of income. Salary is counted in full. Overtime, bonuses, commission, casual, self-employed and rental income are each treated differently, and some lenders only count part of them.
- Existing debts. Car loans, personal loans, buy now pay later and HECS/HELP repayments all reduce what you can borrow. Credit cards count at the full limit, even if you pay them off every month.
- Living expenses. Lenders use the higher of your declared spending and a benchmark for your household size.
- Dependants. Each child raises your assessed expenses.
- Deposit. A bigger deposit doesn’t change what you can service, but it changes the price you can buy at and opens up more lenders.
The 3% buffer most people don’t know about
Lenders don’t test whether you can afford today’s rate. APRA requires them to check you could still repay at your rate plus 3%, so a 6.45% loan is assessed as if it were 9.45%. That buffer is the main reason the bank’s maximum is lower than you might expect from the advertised rate. Lenders also limit how much they lend at six times income or more, so very high multiples are harder to get.
How a rate rise changes your borrowing power
When rates rise 0.25%, the assessment rate rises too, so the same income supports a smaller loan: roughly 2% less for each 0.25% rise. In the examples above, that is about $10,000 less for a single person on $100,000 and about $25,000 less for a couple on $100,000 each. Lenders passed on the September 2026 rise from 9 October; for the latest, see our RBA cash rate page.
Already pre-approved? A pre-approval is assessed at the rate on the day. If rates rise before formal approval, the lender reassesses at the new rate, and a borrower right at their limit can come in lower. If you’re bidding at the top of your range, have your numbers re-checked first. See how pre-approval works.
Why two banks give different numbers
Each lender has its own formula: how it treats overtime, casual or self-employed income, rental income, HECS and living expenses. That’s why borrowing power genuinely varies between banks, and why matching you to the right lender for how you earn can change what you can buy. If you’re self-employed, see what lenders want from self-employed borrowers.
Seven ways to borrow more
- Cut unused credit card limits. In our examples a $10,000 limit costs about $45,000 of borrowing power, even with a zero balance.
- Clear small debts. A car loan or buy now pay later account can weigh more than its balance suggests.
- Make sure all your income counts. Overtime, bonuses, allowances and rent are counted differently by different lenders.
- Use your latest figures. If you’ve just lodged a tax return, your new income may help. See how your tax return moves borrowing power.
- Tidy your spending for a few months before applying.
- Choose the lender, not just the rate. Policy differences between lenders often matter more than a small rate difference.
- Look at the deposit side. The 5% Deposit Scheme, Help to Buy or a family guarantee don’t change what you can service, but they change what you can buy with it.
How much can I borrow: common questions
How much can I borrow on a $100,000 salary?
On our estimate, a single person earning $100,000 with no debts or dependants can borrow about $470,000, and a couple earning $100,000 each about $1.1 million, at a 6.45% owner-occupier rate. Lenders test you at your rate plus a 3% buffer and use their own expense and income rules, so results vary by lender.
What determines how much I can borrow?
Your income and how it is earned, your existing debts (including the full limit of any credit cards), your living expenses, the number of dependants, and the lender’s assessment rate, which is your actual rate plus a 3% buffer required by APRA.
How much does a rate rise reduce borrowing power?
Roughly 2% for every 0.25% rise, because lenders assess you at your rate plus 3%. On our estimate a single person on $100,000 can borrow about $10,000 less after a 0.25% rise, and a couple on $100,000 each about $25,000 less.
What is the 3% serviceability buffer?
APRA requires banks to check that you could still repay if your interest rate were 3 percentage points higher. A loan at 6.45% is assessed as if it were 9.45%. APRA has kept the buffer at 3% through 2026.
Does a rate rise affect my pre-approval?
It can. Pre-approval is conditional, and the lender reassesses at formal approval using the rate at that time. If you are close to your limit, a rise between pre-approval and formal approval can reduce the amount you are approved for.
Why do banks give different borrowing amounts?
Each lender has its own policy on overtime, bonuses, casual and self-employed income, rental income, HECS and living expenses. Borrowing power for the same person can differ by tens of thousands between lenders because of policy, not price.
How can I increase my borrowing power?
Reduce or close unused credit card limits, pay off small debts such as car loans or buy now pay later, make sure all eligible income is counted, and choose a lender whose policy suits how you earn.
Get your real number
Online estimates are a starting point. Your true borrowing power depends on the lender and the detail. We’ll run your numbers across 40+ lenders and show you not just the figure, but how to improve it. Try the borrowing power estimator first, then we’ll refine it together. This is general information, not advice for your situation.