How much can I borrow on a $100,000 Income

Home loan comparisons on Mozo - last updated 2 August 2021

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    Mozo Experts Choice 2021
    Smart Booster Home Loan

    2 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    1.85% p.a.variable for 24 months and then 2.25% p.a. variable
    2.21% p.a.

    New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.

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    UHomeLoan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    1.95% p.a.
    fixed 3 years
    2.27% p.a.

    $0 fees and easy application. Choose between weekly, fortnightly or monthly repayments. 3 year fixed rates are for new Owner Occupier Principal & Interest loans.

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    Mozo Experts Choice 2021
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    1.99% p.a. variable
    1.99% p.a.

    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

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    Variable Home Loan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    1.99% p.a. variable
    1.99% p.a.

    Refinance only. Super-fast digital application process. Zero upfront fees. No on-going service fees. Free 100% offset sub account. Comes with Visa debit card and the ability to use digital wallets; Apple and Google Pay. 25% deposit required.

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    Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    2.09% p.a.
    fixed 3 years
    2.32% p.a.

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

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    Mozo Experts Choice 2021
    Variable Home Loan Special

    Owner Occupier, Principal & Interest, LVR <70%

    interest rate
    comparison rate
    1.99% p.a. variable
    2.02% p.a.

    Special rate applies to home loan applications submitted by 31 October 2021. Unlimited additional repayments, free redraw, 100% offset account. 30% deposit required. Simple online application. Low Cost Home Loan winner in the Mozo Expert's Choice Awards for 2021.

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  • Hot DealReceive $3,288 cashback when refinancing to HSBC (T&Cs apply)
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    Discounted Home Value Loan

    Owner Occupier, Principal & Interest, LVR <70%

    interest rate
    comparison rate
    2.19% p.a. variable
    2.20% p.a.

    No ongoing service fees. Free unlimited extra repayments and online redraw facility.

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    Equity Plus

    Owner Occupier, Principal & Interest, LVR <60%

    interest rate
    comparison rate
    1.87% p.a. variable
    1.90% p.a.

    Low rate variable home loan with optional offset. Free online redraw. No valuation fee. Purchase, refinance or equity release purposes allowed. Min 40% deposit.

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  • Hot Deal$3,000 cashback offer when you refinance your home loan to BOQ. To qualify, apply by 29 August 2021, T&Cs apply.
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    Mozo Experts Choice 2021
    Discount Fixed Rate

    Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    1.99% p.a.
    fixed 2 years
    3.07% p.a.

    Lock in a competitive rate for 2 years. Only 20% deposit required. Flexible repayment options and make up to $5,000 in additional repayments annually. Refinance to BOQ by 29 August, 2021 and get $3,000 cashback(T&Cs apply).

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    Special Fixed Rate Home Loan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    1.89% p.a.
    fixed 2 years
    3.67% p.a.

    Lock in a low fixed rate or choose to split your loan between fixed and variable. Insurance discounts and no fee credit card or zero fee personal loan available. $2,000 cashback offer for home loans over $250k with at least a 20% deposit when refinancing to Newcastle Permanent.

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    UHomeLoan (1 Yr Fixed)

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    1.79% p.a.
    fixed 1 year
    2.32% p.a.

    Fast, easy to apply and no ongoing fees. Choose between weekly, fortnightly or monthly repayments. 1 year fixed rates are for new Owner Occupier Principal & Interest loans.

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    First Rate Home Loan

    Owner Occupier, Principal & Interest, LVR<80%

    interest rate
    comparison rate
    2.84% p.a. variable
    2.89% p.a.

    This home loan from Bank First offers owner occupiers a competitive variable rate, plus a number of additional features. Enjoy flexible repayments, no ongoing fees and our low variable rate.

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    Basic Home Loan

    Owner Occupier, LVR<60%, Principal & Interest

    interest rate
    comparison rate
    2.29% p.a. variable
    2.29% p.a.

    Competitive low variable rate. No application or account management fees. Flexibility to split your loan and set different repayment types. Fee free withdrawals of your savings.

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    Mozo Experts Choice 2021
    Fixed Rate Home Loan

    Owner Occupier, Principal & Interest, LVR<80%

    interest rate
    comparison rate
    1.99% p.a.
    fixed 3 years
    2.59% p.a.

    Competitive fixed rates across 1 to 5 year terms. No application fee or annual fee. Free extra repayments (up to $10,000 per year). Winner of Australia's Best Large Mutual Bank 2021.

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    Well Balanced Fixed

    Owner Occupier, Principal & Interest, LVR <80%

    interest rate
    comparison rate
    1.84% p.a.
    fixed 1 year
    2.01% p.a.

    Super low fixed rate and only 20% deposit required. Optional 100% offset account. Free extra repayments and redraw facility. Flexible repayment schedule.

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    Mozo Experts Choice 2021
    Liberate Variable Home Loan

    70-80% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    2.19% p.a. variable
    2.08% p.a.

    Fast online application with no fees. Free extra repayments and redraw facility. Min 20% deposit. Athena automatically lowers the rate as the loan is paid down. Winner of three Mozo Expert's Choice Awards for 2021.

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    Green Home Loan

    Owner Occupier

    interest rate
    comparison rate
    2.08% p.a. variable
    2.36% p.a.

    Great low rate on investment loans when you package with your owner-occupied loan.

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    Fixed Home Loan Special Offer

    Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    1.89% p.a.
    fixed 2 years
    2.85% p.a.

    Competitive low fixed rates for owner occupiers. No monthly account keeping or loan establishment fees. 20% deposit required. Get $3K cash when you refinance to a Suncorp Bank home loan of $750K+ with LVR <= 90%. Apply by 31/08/21, settle by 31/08/21. (T&Cs apply).

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    Variable Home Loan

    Owner Occupier, Interest Only

    interest rate
    comparison rate
    2.49% p.a. variable
    2.17% p.a.

    Refinance only. Super-fast digital application process. Zero upfront fees. No on-going service fees. Free 100% offset sub account. Comes with Visa debit card and the ability to use digital wallets; Apple and Google Pay. 25% deposit required.

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    Smart Home Loan 80

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    2.48% p.a. variable
    2.50% p.a.

    Low-rate variable home loan that could save you thousands. No ongoing fees. Unlimited extra repayments and free redraws. Maximum borrowing $1 million and at least a 20% deposit required.

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Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

Top tips for home loan borrowing on a $100,000 salary 

If you’re keen to kickstart your home buying journey today, your first step should be to figure out how much you can borrow from a bank or a credit union. 

How do you work out your borrowing power? It’s simple! All you’ll need to do is to scroll up to Mozo’s calculator above and punch in a few of your personal finance details like your expenses and other loan repayments, your desired loan term and expected interest rate. From there, you’ll be able to see an estimate of your borrowing capacity and your monthly repayments down the track. 

What affects my borrowing power?

Earning $100,000 a year from your full-time job? This is information lenders will want to know in order to get a sense of how much money you have access to. When it comes to assessing your borrowing power for a home loan, banks will look at your two most recent tax returns. 

But there’s more to the picture. Whether you’re planning to buy a house as a single borrower or a couple also impacts your borrowing power. Here’s a scenario to illustrate this point. 

Let’s say two different households earn the same level of income per year: in the first case, Sally and her partner are both on $50,000 salaries (or a combined salary of $100,000), while in the second case, Samantha alone is on a $100,000 salary. Although their annual incomes are the same, Sally and her partner would have greater borrowing power than Samantha. The couple would be able to borrow $818,752 while Samantha would only be able to borrow $686,181 (or $132,571 less).*

Why? It comes down to the lender’s assessment of your risk. If you’re earning just one income, an unexpected event like losing your job or a serious illness could mean you’re suddenly unable to make your mortgage repayments. 

For the same reason, when lenders determine your borrowing power, they also consider your type of employment. If you’re self-employed, they’ll likely think of you as higher risk, as it can be more difficult to put a stable number to your income. 

A similar train of thought applies to casual or contract workers, as they can lack job security and benefits like paid leave. So, even if a casual worker and a full-time worker both earn $100,000 in salary, their borrowing capacities would most likely be different. 

Besides the cash that’s entering your bank account every month, lenders are also interested in the money that’s going out. They will look at your household spending, including:

With lenders now keeping a close eye on your living expenses, a great way to improve your chances of borrowing more is to cut down on unnecessary purchases and reduce your expenses at least 3-6 months before taking out a home loan

Got any credit cards, personal loans or car loans under your belt? Lenders will also want to know about those. 

If you’ve got other debts hanging over your head, your borrowing power will be lower, since you’ll be seen as less able to repay your mortgage. That’s why it’s important to minimise other debt before you apply for a home loan. 

Got multiple credit cards or personal loans to pay off? You could use a debt consolidation loan to combine all your debt into one easy-to-manage debt and save on interest costs. 

But if you’ve just got one credit card to pay off and want to dodge high interest while doing so, going with a balance transfer could be a better choice, as most balance transfer deals come with a 0% interest period. 

Top tip: What if you don’t owe anything on your credit card? You might be surprised to hear that that’s still seen as potential debt in the eyes of the lender, because you could rack up a debt as high as your credit limit whenever you want. So before you borrow, make sure to reduce your available credit by cancelling any cards you aren’t using. 

If I’m earning a $100,000 salary, what home loan is right for me? 

Depending on which home loan you choose, your borrowing power could vary quite a lot. Features like interest only repayments, fixed rate and variable rates can all influence the amount you’re able to borrow, not to mention that each lender has its own eligibility criteria you’ll need to meet. 

So which is the right home loan for you? Well, it really comes down to each person’s unique circumstances, but here’s a rundown of how some of those features could influence your borrowing power: 

With variable rate loans, you could lose some of your borrowing power. That’s because when lenders assess your home loan application, they generally add a minimum 1.5% buffer on top of the standard variable interest rate. So instead of the advertised rate of, say, 4%, your lender may use an assessment rate of 5.5% to work out your ability to pay off the loan. 

This buffer helps to offset some of the risks associated with interest rates rising, as higher rates in the market would cause your variable loan repayments to increase too.

By contrast, fixed rate loans tend to have a lower or no assessment rate, so choosing one of those loans could help you to borrow more. 

Fixed rate loans also make budgeting down the track a lot easier, since they guarantee you one interest rate over 3 or 5 years. So if you’re currently not in the financial position to handle sudden rate fluctuations, a fixed rate loan might be the better choice for you. 

But on the flipside, fixed rate loans usually don’t allow borrowers to make additional repayments, unless you pay a fee. 

When would this limit become frustrating? Say, your company gives you pay rise, so you start earning $120,000 instead of $100,000 a year. With more money in your bank account, you’re keen to dedicate a larger portion of your new salary to your mortgage so you can pay off your loan faster and save on interest. However, because you chose a fixed rate loan, you end up having to stick with your initial repayment amount, or else, you’d be hit with extra fees.

For this reason, variable rate loans are a great option if you want to leave all of your repayment options open. They generally come with a range of flexible features, including: 

If you choose an interest only loan, keep in mind you may not be able to borrow as much as you could on a typical principal and interest loan.

That’s because interest only loans can carry more risks than principal and interest loans. While you won’t need to pay down principal initially and the repayments could be lower during the interest-only period, you will have to make a balloon payment at the end of the loan period. So the more you borrow, the more likely you are to not be able to pay it back and default. 

And because you would have more outstanding debt over the term of an interest only loan, you could also expect higher interest costs and a bigger dent in your budget. 

When choosing your loan term, the rule of thumb is: borrowing power shrinks when you have a shorter loan term, since monthly repayments become higher. 

So extending your loan term could actually boost your borrowing capacity, although the downside of this is you’ll end up paying more interest over the life of the loan. 

More FAQS 

How much deposit should I save up for a home loan? 

While there are loans available with all kinds of deposits the magic number is 20% of the property’s value, if you want to avoid Lenders Mortgage Insurance (LMI). So if you’re looking to buy a property for $500,000, that means you’ll need to have a deposit of $100,000. 

Of course, saving up $100,000 is no easy feat - if you’re earning $100,000 a year, that’s one year’s worth of salary before tax! 

These days, the minimum deposit you need for a home loan is 5%, as the maximum you can borrow is 95% of the property value. But keep in mind that if you’ve saved up less than 20% of deposit, you will have to pay LMI, which could eat up thousands of dollars out of your budget. 

For instance, Sam is a first home buyer who wants to buy a $500,000 house. If he has only saved up a 5% deposit of $25,000, then he could expect to pay $15,960 in LMI!** That would be a huge blow to his bank account. 

How do I get approved for a home loan? 

To take out a home loan, you’ll need to be over 18 years old and an Australian citizen or resident. But bear in mind the best rates are generally reserved for the best quality borrowers. Quality is determined by how much deposit you have, your credit history, your income, your expenses, your savings track record, and any other financial commitments you have. Lenders are interested in how responsible you’ve been with your money, so they want to make sure you’ll be able to pay off your mortgage. 

Once you’ve figured out your borrowing capacity and made sure you’re financially prepared to take out a home loan, then it’s a matter of sorting out all of your paperwork. Each lender will look for slightly different requirements, but in general, you’ll be asked to provide: 

Where can I apply for a home loan? 

Right here at Mozo! We compare a whole range of home loans from over 80 lenders, so head over to our home loans comparison table to find a deal that suits you. Once you’ve chosen the home loan that you want, simply click the blue ‘go to site’ button beside the product of your choice. You’ll then have the opportunity to apply for the loan through the lender’s site. 

See? You’re already one step closer to snatching up your dream home!


*Assuming that both households spend $2,000 a month on living expenses and they're looking to take out a home loan over 30 years at an interest rate of 4% p.a. 

**Prices taken on 16 August 2019 for a home loan period of up to 30 years


Written by: Katherine O’Chee, Mozo Money Writer