Home loans borrowing calculator

What’s your borrowing power for a home loan? Before you set your heart on that waterfront mansion, use our borrowing calculator to crunch the numbers and work out how much you’ll be able to borrow - and pay back!

Home loan comparisons on Mozo - last updated 22 February 2024

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    Mozo Experts Choice 2024
    Home Fixed Rate

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    5.80% p.a.
    fixed 3 years
    6.05% p.a.

    Enjoy the security of a competitive fixed interest rate from Up. No application, monthly, annual, redraw, or discharge fees to pay. Up to 50 free offset accounts available. Up home loans are only available to owner-occupiers buying or refinancing in major Australian cities. Up is 100% owned by Bendigo Bank. New joiners get $10 by signing up to the app using code UPHOMEMOZO. (T&Cs apply). Mozo Experts Choice award winner.

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    Details
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    Mozo Experts Choice 2024
    Home Variable Rate

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    6.15% p.a. variable
    6.15% p.a.

    Enjoy a competitive variable interest rate from Up. No application, monthly, annual, redraw, or discharge fees to pay. Up to 50 free offset accounts available. Up home loans are only available to owner-occupiers buying or refinancing in major Australian cities. Up is 100% owned by Bendigo Bank. New joiners get $10 by signing up to the app using code UPHOMEMOZO. (T&Cs apply) Mozo Experts Choice award winner.

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    Details
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    Straight Up

    Obliterate, Owner Occupier, Principal & Interest, <50% LVR

    interest rate
    comparison rate
    6.24% p.a. variable
    6.24% p.a.

    Get a low variable rate depending on your deposit with Athena’s Straight Up Variable Home Loan. AcceleRATES feature helps you to reduce your home loan even faster (T&Cs apply). Zero fees to pay. Free redraw facility. Handy mobile app to manage your home loan.

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    Details
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    Neat Home Loan

    Owner Occupier, Principal & Interest, LVR <60%

    interest rate
    comparison rate
    6.09% p.a. variable
    6.11% p.a.

    Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.

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    Details
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    Straight Up

    Obliterate, Investor, Principal & Interest, <50% LVR

    interest rate
    comparison rate
    6.34% p.a. variable
    6.34% p.a.

    Investors get a low variable rate depending on your deposit with Athena’s Straight Up Investor Variable Home Loan. AcceleRATES feature helps you to reduce your home loan even faster (T&Cs apply). Zero fees to pay. Free redraw facility. Handy mobile app to manage your home loan.

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    Details
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    Flex Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR <60%

    interest rate
    comparison rate
    6.64% p.a.
    fixed 3 years
    6.52% p.a.

    Competitive Fixed rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

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    Details
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    Fixed Rate

    Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    6.54% p.a.
    fixed 2 years
    7.10% p.a.

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

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    Discounted Home Value Loan

    Owner Occupier, Principal & Interest, LVR 70-80%

    interest rate
    comparison rate
    6.09% p.a. variable
    6.09% p.a.

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Settlement fee waived on new borrowings from $50,000 (T&Cs apply).

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    Details
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    Flex Home Loan

    Owner Occupier, Principal & Interest, LVR 70-80%

    interest rate
    comparison rate
    6.19% p.a. variable
    6.43% p.a.

    Competitive variable rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process.

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    Details
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While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

Calculating your home loan borrowing power

Figuring out roughly what a bank or credit union will lend you for a home loan is the first step in the home buying process. Afterall, you don’t want to find the perfect home only to find out that you won’t be able to get the money to fund purchasing it. To help you get an estimate of how much you’ll be able to borrow plug a few of your personal finance facts into our home loan borrowing calculator above. It will give you a good idea of how much you’re able to borrow and successfully pay back on your home loan each month based on your budget so that when it comes time to shortlist the properties in your desired Aussie neighbourhood you have a good idea that you’ll be approved for a loan.

What information will goes into determining how much I can borrow?

All banks and home lenders will want to make sure that if they loan you money for a new home that you’ll be able to pay it back. Mortgage stress is a real issue and to make sure that you don’t fall victim to this, you’ll want to be really upfront about your income and your liabilities. The main factors that determine your borrowing power are:

Your income

Your income will be an important factor when determining your home loan borrowing muscle. If you’re earning a single income you might not have access to as much money as when you’re buying as part of a couple.

Your living expenses

Living expenses like your grocery and energy bills are also an important part of the home loan borrowing power formula. The more streamlined you can make these, the more you’ll be able to manage in terms of monthly mortgage repayments. While we give you the option to use default living expenses, we recommend entering your own customised figures so that you will get a more realistic idea of how much you’ll be able to borrow on your home loan.

Other monthly repayments

Do you have other monthly repayments like a car or personal loan? These will also impact your borrowing power for a home loan so it’s a good idea to try and get these as low as possible. And if you have any debts like a credit card bill, make sure that you also include this. 

Your preferred loan term

While the standard mortgage term is 25 years, most lenders will have mortgages up to 30 years. The advantage of opting for a shorter home loan term is that you incur less interest over the life of the loan, but this could mean your monthly repayments are a little more steep.

Why do banks factor in a rate rise in their calculations?

The reality is that over a 30 year mortgage there will be periods when the interest rate on your home loan changes and to protect themselves, banks want to know that if rates do go up, you will still be able to cover your monthly mortgage repayments. It’s also good for your peace of mind to know that if rates jump you will be able to pay back your loan without too much difficulty or at least have an idea of how much extra you will need to find in your budget so that you can cut back on other areas if needed. So have a play around with the rate change functionality of our calculator to get a sense of how much you’d need if there was a rate rise.

How much should I set aside for a deposit?

In addition to the amount your home loan lender will let you borrow, you’ll also need a home deposit saved up to get your foot in the door of your first property. In Australia, it’s recommended that you have a 20% deposit, but some home loan providers will let you borrow with less as long as you pay Lenders Mortgage Insurance

Other helpful home loan borrowing tips

Keep an eye on your LVR

LVR stands for loan to value ratio, which is all about how much you’ve saved up for your home loan deposit. Generally, the lower your LVR, the better you’re borrowing power will be. In Australia, the preferred LVR is anything less than 80% - which means you should be aiming for a deposit of 20% or more of the value of your dream home. If that seems like too much of a hurdle, there are lenders who offer low deposit home loans, for LVRs up to 95%. But keep in mind that if you opt for one of these offers, you’ll have to take into account the cost of lenders mortgage insurance.

Factor repayments into your budget

The more you borrow, the bigger your repayments will be! So even if you qualify for a whopping home loan, ask yourself if you really need it and if the repayments are in line with your monthly budget and lifestyle. A good rule of thumb is to compare the repayment amount with your current rent. If they’re similar figures, you should be able to handle the repayments pretty easily. But remember to plan for the possibility of a rate rise, as shown on the calculator - it’s best to have a financial buffer, just in case.

Plan for stamp duty

Another big cost to consider when looking for a home loan is stamp duty. The government can sometimes charge you in the tens of thousands of dollars, which might just about break your budget. If you - or your wallet - don’t like the idea of paying it as a lump sum, you can also opt to add it to the price of your monthly repayments. Find out how much you might be up for in stamp duty with our handy calculator.

Review your credit report

To boost your borrowing power before you apply for a home loan, get a copy of your credit report and go over it with a fine tooth comb. Any mistakes or incorrect details could be stopping you from being approved for a loan but keep in mind that, under the new comprehensive credit reporting legislation lenders will also be looking at your positive credit repayments.

Pay off debts

Got a credit card debt hanging over you? It could be damaging your chances of getting a home loan. Check out a balance transfer deal and blast credit card debt to get back on track toward a home loan.

Start saving!

Having a regular savings plan will make you look reliable and money savvy. Plus, setting up good savings habits will help you build up a home loan deposit and lower your LVR which will get you a better deal on your home loan.

For more helpful information on how to get your foot in the door of your dream home or fully finance your next investment property, check out our comprehensive range of home loan guides.