Question 1

Why do different lenders give different borrowing capacity numbers?

Accepted Answer

Each lender uses its own assessment rate (the higher rate they stress-test against), DTI cap (debt-to-income limit), HEM benchmark, and treatment of variable income. APRA banks must apply a 3% buffer above the actual rate; non-banks can use 2.0–2.75%. Two lenders with the same actual rate can disagree on your borrowing capacity by $200,000 or more on identical inputs.

Question 2

What is the assessment rate or serviceability buffer?

Accepted Answer

The assessment rate is the rate the lender pretends you're paying when they check whether you can afford the loan — usually 2–3% above your actual rate. APRA requires APRA-regulated banks to add at least 3% as a buffer; non-banks can use 2.0–2.75%. Lower buffer = more borrowing capacity for the same income.

Question 3

Does this calculator factor in living expenses?

Accepted Answer

Yes. We use the HEM (Household Expenditure Measure) floor — the minimum living expenses lenders apply for your household and income. If your declared expenses are higher than the HEM, lenders use the higher figure; if lower, they use HEM. The calculator applies this the same way the lender will.

Question 4

Is this calculator's number what I'll actually be approved for?

Accepted Answer

It's the closest you can get without lodging a deal. We use real lender policy data from our Connective aggregator's matrix releases. Final approval depends on credit history, valuation, and lender-specific overlays we can't model from a calculator. For a deal-binding number we run the lender's own servicing calculator together.

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