How Much Can You Really Borrow in 2026?
One of the most common questions borrowers ask is: "How much can I borrow?" The answer has changed substantially over the past 18 months as the RBA has shifted from aggressive rate hikes to an easing cycle. Here's an up-to-date look at where borrowing capacity stands in 2026 and what affects it most.
How Rate Changes Affect Borrowing Power
When interest rates rise, your assessed borrowing capacity falls — and vice versa. The RBA's rate cuts over the past year have meaningfully improved how much Australians can borrow. Here's a rough guide to what typical income profiles can borrow as of mid-2026:
| Annual Income | Approximate Max Borrowing (No Existing Debt) |
|---|---|
| $80,000 | $450,000 – $530,000 |
| $120,000 | $680,000 – $780,000 |
| $150,000 | $850,000 – $960,000 |
| $200,000 (couple) | $1,100,000 – $1,300,000 |
| $250,000 (couple) | $1,400,000 – $1,600,000 |
These are indicative figures only, based on owner-occupier P&I loans with no other debts. Individual results will vary significantly.
The Serviceability Buffer: Still 3%
APRA's serviceability buffer — which requires lenders to assess borrowers at the loan rate plus 3% — remains in place at 3%. Despite calls from some quarters to reduce the buffer (which would significantly increase borrowing capacity), APRA has maintained it as a macroprudential safeguard. This is the single biggest cap on what people can borrow relative to their income.
Key Factors That Reduce Your Borrowing Capacity
- Credit card limits: Every $10,000 of credit card limit reduces your borrowing capacity by approximately $45,000–$50,000 — regardless of whether you carry a balance
- HECS/HELP debt: Assessed at approximately 1% of your outstanding balance per year, reducing serviceability
- Car loans and personal loans: Each dollar of existing repayment directly reduces how much new debt you can service
- Living expenses: Lenders use HEM benchmarks or your declared expenses, whichever is higher
- Dependants: Each dependent child reduces assessed borrowing capacity
How to Maximise Your Borrowing Capacity
- Cancel unused credit cards before applying — this is the quickest win for most borrowers
- Pay off small personal and car loans if possible
- Include all income sources: overtime, bonuses, rental income, Centrelink — properly documented, these all count
- Choose the right lender: Different lenders have different policies on how they treat various income types and expenses. Some are significantly more generous than others for specific borrower profiles
- Use a broker: A broker can compare your profile across 30+ lenders and identify who will lend you the most — or at the best rate for your capacity
Get a Precise Assessment
The figures above are illustrative. The only way to know exactly what you can borrow is to have your full financial position properly assessed. Loan Rocket brokers provide obligation-free borrowing capacity assessments that give you a clear, accurate picture of your position — and a strategy to improve it if needed.