Estimate your Australian income tax and take-home pay.
Lenders assess serviceability on your net position, and your own budget runs on what actually lands in your account. Working from gross income overstates what you can commit to a repayment, sometimes by a wide margin once tax, the Medicare levy and any student loan repayment are taken out. Start from the after-tax figure when you are testing whether a repayment is affordable.
The two items that most often get missed are the compulsory study and training loan repayment, which starts once income passes a threshold and is deducted alongside tax, and the treatment of income that is not salary — bonuses, second jobs, investment income. Each affects your net position and each is treated differently by lenders when they assess an application.
Run your after-tax income first, then take your realistic monthly commitment from the loan repayment calculator, and see what is left. That remainder is what actually funds living costs. If it is thin before the loan starts, it will be thinner if rates move.
A calculator gives you a starting figure. What a lender will actually approve depends on your income, expenses, credit history and the property, and it varies between lenders. We compare more than 40 lenders on our panel and will tell you where you genuinely stand — see our home loan, refinancing and car loan services, or the suburb pages for Werribee, Tarneit and Point Cook.
The calculator is indicative and covers standard income tax components. Your actual position depends on offsets, deductions and levies specific to you — confirm with your accountant or the ATO.
Lenders assess gross income and then apply their own expense and buffer assumptions. Your own budgeting should use the net figure.
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