How much can I borrow on $120,000 income?

On a $120,000 salary with about $2,500/month of living expenses and no other debts, this model estimates a borrowing capacity near $627,538 — assessed at the loan rate plus APRA's 3% serviceability buffer. Your lender's figure will differ.

What is the APRA serviceability buffer?

APRA requires lenders to check you could still afford the loan if rates rose by at least 3 percentage points above the product rate — so a 6% loan is tested near 9%. It has been 3% since October 2021 and was reaffirmed in 2025.

Borrowing Power Calculator Australia 2026 | How Much Can I Borrow?

Your borrowing power

You could borrow around

$—

before deposit & buying costs

Assessed at (rate + 3% buffer)—

After-tax income / month$—

Left for repayments / month$—

Actual repayment at your rate$—

—

Track your deposit goal against your real savings

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How much can I borrow?

Lenders don't lend a flat multiple of your income — they run a serviceability test. They take your after-tax income, subtract your living expenses and existing repayments, and check the leftover covers a home-loan repayment calculated not at today's rate but at your rate plus a buffer. Since October 2021 APRA has set that buffer at 3 percentage points, so a 6% loan is tested near 9%.

Why your lender's number will differ

Two big reasons. First, lenders use the greater of your stated expenses or the Household Expenditure Measure (HEM) — a benchmark minimum — so understating expenses won't help. Second, they shade some income (overtime, bonuses, rent) and treat credit-card limits as debt. Treat this as a starting estimate, then get a real assessment.

Borrowing power FAQ

Does a HECS/HELP debt reduce how much I can borrow?

Yes — your compulsory HELP repayment is an ongoing commitment lenders count against your income. Add it to "other monthly repayments" above.

Will a higher deposit let me borrow more?

It lets you buy more (loan + deposit), and getting to a 20% deposit avoids LMI, but it doesn't raise the loan your income can service — that's set by serviceability.

Estimate only — general information, not financial advice or a lending offer.