The big levers
- Debt‑to‑Income (DTI): Your total debt divided by gross income. Lenders set caps (e.g., 6×). Lower is safer.
- Assessment rate (buffer): Your loan is tested at a rate above the actual rate (a risk buffer) to ensure you can handle rises.
- Living expenses: Benchmarked (HEM) and cross‑checked against your statements.
Policy factors that move the needle
- Income treatment: Overtime, commission, bonuses, rent — typically shaded or averaged.
- Dependants & childcare: These reduce capacity more than people expect.
- Credit conduct: Late payments and high utilisation can trigger tighter views.
- HECS/HELP: Counts as a liability; don’t ignore its impact.
Optimising capacity ethically
- Reduce unused card limits, clear small personal loans, document stable overtime.
- Consider longer loan terms to improve serviceability (with eyes open to total interest).
- If self‑employed: tidy up financials, note add‑backs (non‑recurring expenses), keep BAS up‑to‑date.
Ask us for a “Top‑3 Lenders Capacity Sheet”? Request a free Strategy Call.
We will show you the lending amounts and the policy reasons behind them.