Last updated: July 2026 · Reviewed by John Pierre Saliba, Director and Mortgage Broker, MFAA Accredited
Borrowing Power on $120,000 Per Year
On a $120,000 salary, you can typically borrow approximately $660,000 to $720,000. Monthly repayments on $660K at 6.2% would be around $4,020. Lend & Loan compares 50+ lenders. Call 02 8046 3933.
Estimates only. Actual borrowing power varies by lender, expenses, debts, and personal circumstances.
On a $120,000 gross salary with no dependants and minimal debts, most Australian lenders will approve a home loan between $660,000 and $720,000. This is based on approximately 5.5 to 6 times gross income, adjusted for the lender's serviceability buffer (currently 3% above the loan rate).
At $120K, you are above the median full-time income in Australia, and lender appetite is strong. The key variable is how much of your income goes to existing commitments. A clean application with no other debts will sit at the higher end of the range.
$DISCLAIMER$120K is a sweet spot for many lenders. You have enough income to comfortably service a loan while still qualifying for products aimed at mainstream borrowers. At this income, I typically see borrowing power vary by $60,000 to $80,000 between lenders, so comparison matters.
What Affects Your Borrowing Power?
Existing debts
Credit cards, car loans, HECS/HELP, personal loans, and buy-now-pay-later accounts all reduce borrowing power. On a $120K salary, a $15,000 car loan can reduce your capacity by approximately $40,000 to $60,000.
Number of dependants
Each dependant reduces borrowing power by approximately $30,000 to $60,000. A couple on a combined $120K with two children will borrow significantly less than a single borrower on $120K with none.
Living expenses
Lenders use either your declared expenses or the Household Expenditure Measure (HEM), whichever is higher. Reducing discretionary spending three months before applying can improve your position.
Lender choice
Different lenders use different serviceability models. A broker comparing 50+ lenders can find the one that assesses your income most favourably for your specific circumstances.
What Can You Buy on $660K to $720K?
With borrowing power of $660,000 to $720,000, plus a 20% deposit, your total purchase price sits around $825,000 to $900,000. Here are areas where that budget works well.
At this budget, Parramatta opens up for units and townhouses, and Western Sydney offers houses. Gosford on the Central Coast and Newcastle provide houses with room to grow. Inner Brisbane suburbs like Nundah and Chermside are also well within range.
Single vs Couple on $120K
| Scenario | Borrowing Power | Monthly Repayment |
|---|---|---|
| Single, $120K, no debts | $660K - $720K | ~$4,020/mo |
| Single, $120K, $15K car loan | $600K - $660K | ~$3,650/mo |
| Couple, $120K combined, no debts | $620K - $680K | ~$3,780/mo |
| Couple, $120K combined, 1 child | $560K - $620K | ~$3,410/mo |
Estimates only. Actual borrowing power varies by lender, credit history, and individual circumstances. Rates and calculations as at June 2026.
How to Maximise Your Borrowing Power
- Close unused credit cards. Even a $0 balance card reduces capacity.
- Pay down personal loans and car finance before applying.
- Reduce buy-now-pay-later balances (Afterpay, Zip) to zero.
- Pay down HECS/HELP if close to a threshold that changes your repayment rate.
- Use a mortgage broker to compare 50+ lenders and find the one that assesses your income most favourably.
Get a personalised estimate with our borrowing power calculator. For a precise figure across 50+ lenders, call John on 02 8046 3933 or book a free consultation.
