Borrowing capacity calculator
Lenders start from the payment you can carry, not the price you want. They cap it at a share of income after existing debts, and the loan follows from there. This works that calculation in the order a lender does.
- You could borrow
- $197,901
- Affordable monthly payment
- $1,100.00
- Debt-to-income ratio
- 35.0 %
- Left each month
- $2,600
- Interest over the full term
- $132,099
An estimate of what a lender might offer, not a credit decision. Affordability assessments also weigh your history, job security and the property itself.
The formula
Affordable payment = income × limit − existing debts. Then the principal is the annuity formula inverted: P = M · (1 − (1 + i)^−n) / i, with i the monthly rate and n the number of months. Budget = principal + deposit.
Worked example
On 4,000 a month with 300 of existing debt, at a 35% limit: 1,100 a month affordable. Over 25 years at 4.5% that borrows 197,901, so with a 30,000 deposit the budget is 227,901.
How to use it
- 1Use income after tax and after social contributions — the figure that reaches your account.
- 2Count every existing commitment: car finance, personal loans, other mortgages, maintenance payments.
- 3Watch what the term does to the budget. Stretching from 20 to 25 years raises capacity, but the extra interest is substantial.
Questions people ask
What limit do lenders actually use?
Around 33% to 35% of net income in much of Europe, and often stricter for a first loan. Some markets use a gross-income multiple instead. Ask your lender which test they apply before house-hunting.
Is this what I should borrow?
It is the ceiling, not a recommendation. Borrowing at the maximum leaves nothing for a rate rise, a repair or a job change. The amount left each month is shown for exactly that reason.
Last reviewed: 2026-10-20