Borrowing Power Assessment for Joseph (NT, Self-Employed)
Snapshot of Financial Position
| Detail | Amount / Notes |
|---|---|
| Age | 49 |
| Employment | Self-employed (ABN held for 5 years) |
| 2024 FY Income | $300,000 (Declared on NOA) |
| Rent Paid | $550 / week |
| Savings / Deposit | $50,000 |
| Superannuation | Joseph: $140,000 Partner: $70,000 |
| Credit Cards | 1 card (limit $7,000) |
| Dependents | 0 |
| Investment Property | 1 (NT 0831) |
| Outstanding Investment Loan | $470,000 |
| Property Value | $611,000 |
| Monthly Mortgage Repayments | $3,000 |
| Rental Income | $700 / week |
| Car Loans | None |
Borrowing Power Breakdown
Income Considered by Lenders
- Declared self-employed income: $300,000 (2024 NOA)
- Rental income (80% loading): $700 × 52 × 0.8 ÷ 12 ≈ $2,427 / month
- Total assessed monthly income: ≈ $27,427
Existing Monthly Commitments
- Investment mortgage: $3,000
- Rent on current residence: ≈ $2,383
- Credit card minimum payment (estimate): $300
- Living expenses (estimate): $2,000
- Serviceability buffer (typical): $500
Surplus and Maximum Repayment Capacity
After costs and buffers, Joseph’s estimated monthly surplus is ≈ $19,243. This surplus underpins his theoretical maximum borrowing capacity.
Estimated Borrowing Capacity
| Method | Estimated Limit |
|---|---|
| Surplus-based capacity | ≈ $2.89 million |
| Income-based cap (6× NOA) | $1.8 million |
Note: Lenders often cap loans at 4–6× annual income for prudent assessment. Although surplus allows more, $1.8 M reflects a responsible lending cap.
Structure, Flexibility & SMSF Notes
- Self-employed assessments: Some lenders use 1–2 years of NOA; recent policy trends allow a single strong year.
- SMSF lending: Only superannuation balances and SMSF income count; borrowing power is typically lower and tightly regulated.
- Final approval: Depends on lender policies, living costs, credit history, property type, and inclusion of partner’s assets/income.
Summary of Key Figures
| Factor | Joseph (Solo Borrower) |
|---|---|
| 2024 NOA Income | $300,000 |
| Rental Income (80% load) | $2,427 / month |
| Borrowing Power Range | $1.8 M (capped) – $2.89 M (theoretical) |
Recommendations
- Expect most lenders to quote borrowing power between $1.8 M and $2.89 M.
- Engage a mortgage broker or lender with full documentation and accurate living-expense data.
- Factor in existing debt, realistic rental income, and personal risk appetite when deciding on a loan amount.
This estimate is based on mid-2025 lending criteria and the profile provided. Actual outcomes may vary; consult a specialist lender or broker for a tailored assessment.
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