1. Essential Service Workers May Have Higher Borrowing Capacity

If you work in an essential service role—such as a nurse, doctor, teacher, police officer, firefighter, or paramedic—you may be eligible for higher borrowing limits with certain banks. Lenders view these professions as stable and secure, meaning they often offer special considerations, such as:

• Higher Loan-to-Value Ratios (LVR): Some lenders allow essential workers to borrow up to 90-95% of a property’s value without requiring Lenders Mortgage Insurance (LMI), which can save thousands of dollars.

• More Flexible Lending Criteria: Due to job security and consistent income, banks may extend higher loan amounts compared to applicants in less stable industries.

• Discounted Interest Rates: Some banks provide exclusive rate discounts and fee waivers to essential service workers, making borrowing more affordable.

• Government Assistance Programs: Essential workers may qualify for additional grants and home-buying assistance schemes.

If you work in an essential service, speaking to a mortgage broker can help you find lenders who offer these benefits, potentially increasing your borrowing power.

2. Reduce Existing Debts

Ever wondered how much having a car loan affects your borrowing capacity?

Lenders assess your debt-to-income ratio, which compares your income to your existing financial commitments. To improve your borrowing power:

• Pay down personal loans, car loans, and credit cards.

• Consider consolidating debts into a lower-interest option.

• Avoid taking on new liabilities before applying for a mortgage.

3. Increase Your Income

Have you considered how a side hustle or pay rise could boost your borrowing power?

A higher income allows you to borrow more. You can achieve this by:

• Negotiating a pay rise or taking on additional work.

• Exploring side income opportunities such as freelancing or investing.

• If applicable, including rental income from an investment property.

4. Save for a Larger Deposit OR Guarantor Options

Did you know that a bigger deposit or a guarantor can help you secure a home loan faster?

A larger deposit reduces the amount you need to borrow and may also allow you to access lower interest rates. However, if saving a large deposit is challenging, having a guarantor can be a great alternative. A guarantor is usually a close family member who offers part of their property as security for your loan, which can help you:

• Avoid paying Lenders Mortgage Insurance (LMI)

• Increase your borrowing capacity

• Secure a loan with a smaller deposit

Consider:

• Setting a clear savings goal and budgeting accordingly.

• Using government incentives such as the First Home Owner Grant.

• Reducing discretionary spending to boost savings.

5. Minimise Discretionary Expenses

Are your everyday spending habits holding you back from securing a higher loan?

Lenders review your spending habits to determine your financial stability. Reducing unnecessary expenses, such as dining out or subscription services, can improve your loan eligibility.

6. Choose the Right Loan Structure

Confused about which loan type suits your financial goals best?

The type of loan you choose can impact your borrowing capacity. Options include:

• Principal and Interest Loans – Standard repayment structures that gradually reduce your loan balance.

• Interest-Only Loans – Lower repayments initially, but may reduce borrowing capacity in the long term.

• Fixed vs Variable Rates – Fixed rates provide certainty, while variable rates may allow greater flexibility.

Calculate Your Borrowing Power

Understanding your borrowing capacity is key to making informed property decisions. Use our Borrowing Power Calculator to get an estimate based on your financial details.

Next Steps

If you're looking to boost your borrowing power and get expert guidance on your home loan options, our team at Mortgage Matrix is here to help. Book a free consultation today to explore tailored strategies and find the best loan for your needs.

By implementing these strategies, you can enhance your financial position and maximise your property purchasing potential. Start planning today and take control of your borrowing power!