One of the most common things we’re asked is how to improve serviceability—that is, your ability to borrow more money for a home loan. Whether you're buying your first home, upsizing, or investing, understanding how banks assess your financial position can make all the difference.
There are several ways to improve your borrowing power, and many of them are simpler than you might think.
1. Increase your deposit
One of the biggest levers you can pull to improve serviceability is increasing your deposit. While it might seem obvious, the impact of moving from a 15% deposit to 20% or more is significant.
Banks often require less income to service a loan when you're contributing more equity. That’s because higher deposits reduce risk, which can open the door to more favourable lending conditions and higher borrowing amounts.
2. Boost your income (even slightly)
Even small changes to your income can have a big effect on what you can borrow.
This could include:
Picking up extra hours at work (even 5 hours a week can help),
Negotiating a small pay rise or hourly rate increase,
Returning to work after maternity leave,
Taking on a flatmate or boarder,
Adding verified part-time or secondary income streams.
Every bit of consistent income counts—and it can often make a surprising difference to your overall borrowing ability.
3. Pay down or eliminate debt
Existing debt is one of the key factors that affects how much you can borrow. That’s because regular repayments reduce the amount of income the bank sees as available to service a new loan.
If you have:
Credit cards (even with low balances or unused limits),
Personal loans,
Car loans,
...paying these down or clearing them completely can make a huge difference. For example, getting rid of a $300 per fortnight car repayment might allow you to borrow up to $50,000 more—a major boost when you're trying to reach that next price bracket.
Tailored advice for your goals
Every situation is different, and that’s why we always look at your full financial picture before offering advice. Whether you're close to where you need to be, or just starting the journey, we can suggest simple, achievable steps to get you closer to your property goals.
Get in touch with us today; book a call to talk to one of our advisers and we can help you improve your serviceability and borrowing power!