How much can I borrow for a home loan?

The question most often asked when buyers start shopping for a new home is “How much can I borrow for a home loan?” Knowing the answer to “how much can I borrow for a home loan” is an extremely important piece of information during the home shopping process.

How do lenders decide how much you can borrow for a home loan? They base their decision on their estimate of your ability to repay the loan by considering the following factors:

  • Income
  • Savings history
  • Loan-to-value ratio
  • Credit rating/history
  • Length of employment
  • Amount of deposit or equity
  • Debt-to-income ratios

Other factors that lenders consider are your lifestyle and spending habits, age, and other personal factors.

Lending guidelines vary among lenders—meaning some lenders have stricter requirements than others. We often see differences of over $200,000 between lenders, which can make a huge difference in the quality of home you can purchase. This is why we suggest speaking with a mortgage broker rather than a lender, as we can access and compare all of our lenders’ calculators, including all major Banks, to give you a true maximum loan amount.

If you need to know “How much can I borrow for a home loan?” there are no simple answers. All of these factors should be taken into account to give you an accurate figure. 

Request your FREE Borrowing Capacity Report and one of our consultants will contact you to discuss your options.