Serviceability Calculator
Estimate your indicative borrowing power the way a lender would — assessed at a buffered rate, so you know roughly what you could afford to borrow.
🇦🇺 AustraliaHow this serviceability calculator works
Serviceability is the test every Australian lender runs to decide whether you can comfortably afford a loan. It weighs your income against your living costs, existing debts, and the proposed mortgage repayment. The largest loan that still passes that test is your borrowing power — and it's usually the real limit on what you can buy, not your deposit.
The headline of any serviceability assessment is the buffer. Under APRA's guidance, lenders must assess your repayments at a rate 3 percentage points above the actual interest rate. So a 6.2% loan is tested at roughly 9.2%. This protects you if rates rise. We apply the same +3.0% assessment buffer to your rate before working out your capacity.
From there, we convert your gross annual income to monthly, then subtract your living expenses and existing debt repayments to find your monthly surplus. We treat that full surplus as your maximum housing repayment capacity — a simplifying assumption — and reverse the standard loan formula at the buffered rate over your chosen term to find the largest loan that surplus could service.
These figures are indicative only. Real lenders apply their own expense benchmarks (such as the Household Expenditure Measure), shade some income types, account for dependants and credit history, and rarely treat your entire surplus as available for repayments. Use this for planning, then get an accurate assessment from a licensed broker or lender.
Serviceability questions
Serviceability is a lender’s assessment of whether you can comfortably afford the repayments on a loan. It compares your income against your living expenses, existing debts, and the new mortgage repayment — calculated at a higher "assessment" rate to build in a safety margin. Your borrowing power is the largest loan that still passes this test.
Australian lenders are required by APRA to assess your repayments at a buffer above the actual rate — currently a 3 percentage-point serviceability buffer. This protects you and the lender against future rate rises. We apply the same +3.0% buffer to your rate to estimate the repayment a lender would actually test you against.
We work out your monthly surplus (monthly income minus living expenses and existing debt repayments), treat that surplus as your maximum housing repayment capacity, then reverse the loan formula at the buffered assessment rate over your term to find the largest loan that surplus could service.
Lenders apply their own expense benchmarks (like the HEM), shade certain income types, weigh credit history and dependants, and rarely lend your entire surplus as a repayment. This tool uses simplified assumptions for planning. For an accurate figure, speak to a licensed broker or lender.
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