Borrowing Capacity Calculator
How much a given income can borrow, and what that plus a deposit actually buys once acquisition costs are paid.
Runs entirely in your browser. Nothing is uploaded, logged or stored.
Price you can aim at
305,232.63
- Maximum loan
- 279,651.24
- Monthly payment it implies
- 1,400.00
- Acquisition costs
- 24,418.61
- Cash put in
- 50,000.00
- Total interest over the term
- 140,348.76
- Total repaid
- 420,000.00
- Income left each month
- 2,600.00
The mortgage calculator starts at a price and ends at a payment. This one starts at an income and ends at a price, which is the question asked first and usually answered last.
Two things are easy to get wrong here, and both are handled explicitly: the repayments already committed come off the allowance before anything is borrowed, and the acquisition costs come out of the deposit before any of it reaches the price.
How it works
The allowance is the income times the debt ratio, less the repayments already running. That is the largest instalment a lender applying that ratio would accept.
The loan is the annuity formula solved for the amount instead of for the payment: the principal that instalment clears over the term at that rate.
The price is not simply the loan plus the deposit. The acquisition costs are a share of the price and are paid in cash, so the budget splits between the two: price + price × rate = loan + deposit, which gives the price directly.
Examples
| Case | Input | Result |
|---|---|---|
| A first purchase | 4,000 a month, nothing else running, 35% ratio, 3.5% over 25 years, 50,000 in cash, 8% costs | An instalment of 1,400, a loan of about 279,650, and a price of about 305,200 once the costs are paid out of the deposit. |
| The same income with a car loan running | The same, with 300 a month already committed | The allowance falls to 1,100 and the loan with it: the 300 a month costs just under 60,000 of borrowing capacity. |
Frequently asked questions
Why is the debt ratio not filled in for me?
Because it is a rule, not a constant. Lenders set their own, some countries have a regulator that sets a ceiling, and the figure moves. Writing one into the code would put a number on the page that is the single most consequential input here, sourced from nowhere.
Should I enter my gross or my net income?
Whichever your lender applies its ratio to. The two conventions coexist — some markets work on net income, others on gross — and mixing one country's ratio with another's definition of income gives a confident wrong answer.
Why is the price lower than the loan plus my deposit?
Because the acquisition costs are paid in cash and not borrowed. With 8% of costs, every 100 of budget buys about 92.6 of property and pays 7.4 of duties and fees.
Is this what a lender will actually offer?
No. It is what the ratio you entered implies. A real decision also weighs the deposit as a share of the price, how stable the income is, what is left to live on, the insurance the lender requires and the property itself. This answers the arithmetic half.
Good to know
- Amounts carry no currency: the answer is in whatever you put in.
- Results use double precision floating point arithmetic. That is exact enough to decide with and is not an accounting record.
- The rate is treated as fixed for the whole term, and no borrower insurance is included — where it is compulsory it is usually inside the ratio, which lowers the amount that can be borrowed.
- The income left each month is arithmetic, not a judgement: whether it is enough to live on depends on where you live and who lives with you, and no floor is asserted here.