If you’re planning to buy a home or investment property, one of the most important questions is:
How can I increase my borrowing power?
The reality is — most buyers apply too early, without optimising their financial position first.
And that can cost them:
- Tens of thousands in borrowing capacity
- Better property opportunities
- Or even loan approval altogether
The good news?
Small changes before you apply can make a big difference.
What Is Borrowing Power?
Your borrowing power is the amount a lender is willing to loan you based on your financial situation.
It’s not just your income — banks assess:
- Income
- Expenses
- Debts
- Credit limits
- Interest rate buffers
That’s why two people on the same income can have very different borrowing capacity.
How to Increase Your Borrowing Power 1. Reduce Credit Card Limits
One of the most overlooked factors.
Banks assess your credit limit, not your balance.
Even an unused $10,000 credit card can reduce your borrowing power significantly.
✔ Lower limits or close unused cards before applying
2. Pay Off Personal Debts
Debts like:
- Personal loans
- Car finance
- Buy now, pay later
These reduce your ability to service a loan
✔ Paying them down can immediately improve your borrowing capacity
3. Avoid New Liabilities Before Applying
This is where many buyers go wrong.
Taking on new debt before applying — even something small — can reduce your borrowing power.
❌ Car loans ❌ New credit cards ❌ Large purchases
Timing matters more than most people realise
4. Choose the Right Lender
Not all lenders assess applications the same way.
Each lender has different policies and criteria — meaning some may offer higher borrowing capacity than others for the same scenario.
The right lender choice alone can make a significant difference
5. Structure Your Loan Properly
Loan structure plays a key role in your financial outcome.
Things like:
- Offset accounts
- Repayment types
- Overall loan setup
Can impact both your borrowing power and long-term strategy
Why Preparation Matters
I’ve seen buyers increase their borrowing power by tens — even hundreds — of thousands simply by:
- Adjusting their debts
- Choosing the right lender
- Structuring their application properly
It’s not just about applying — it’s about preparing
Common Mistakes to Avoid
❌ Applying too early ❌ Going directly to one bank ❌ Keeping high credit limits ❌ Taking on new debt before applying ❌ Not getting professional advice
Final Thoughts
In 2026, borrowing power is more sensitive than ever.
The difference between a good and bad outcome often comes down to preparation and strategy.
If you get this right early, everything else becomes easier — from approval to property selection.
If you’re thinking about buying, don’t guess your borrowing power.
At Truth Group Pty Ltd, I help you: ✔ Maximise your borrowing capacity ✔ Structure your loan correctly ✔ Choose the right lender ✔ And guide you in finding the right property (buyer’s agent support)
Finance strategy + property strategy working together
Message me “POWER” and I’ll help you set it up properly before you apply
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