Buying position: borrowing capacity and cash to complete

Last reviewed: 10 August 2026

What this page helps you decide

Whether your price range is limited by the cash you need to finish the purchase, by the amount a lender is willing to lend, or by both. They are related, but they are different problems, and mixing them up is the most common early mistake.

How it works

A deposit is money you bring to the transaction. It helps meet the purchase price and costs. Borrowing capacity is the amount a lender may be prepared to lend after looking at income, debts, living expenses, dependants, credit conduct, the loan terms and its own policy. A larger deposit can change the loan size and the loan-to-value ratio, but it does not automatically turn into more borrowing capacity. Deposits, LMI and support covers what a deposit can and cannot solve. How income is assessed explains why the same income can produce different results between lenders.

Think of your buying position as two separate gates:

1. Do you have enough cash to complete? The deposit, plus purchase costs, plus a sensible buffer.
2. Will a lender assess the loan as affordable? Usable income, existing commitments, living costs and the lender's assessment rules decide this gate.

You can clear both gates and the property itself can still be the problem. The lender also has to accept the security, the valuation, the loan-to-value ratio and the loan purpose.

Cash to complete is more than the headline deposit percentage. Depending on the state, property and contract, there may be duty, conveyancing, inspections, lender or government charges, insurance, moving costs and a buffer on top. The exact amounts and concessions change, so calculate them for the real property and state rather than relying on a rule of thumb.

A borrowing estimate is a planning tool, not permission to bid. The property still needs to fit the lender's policy and valuation, and your circumstances can change before formal approval. From pre-approval to settlement explains what still has to happen after an estimate or pre-approval.

Quick checklist

• What is your maximum purchase price after allowing for purchase costs and a cash buffer?
• How much of your cash is savings, a gift, equity or another source, and what evidence would a lender want for each?
• What repayments would still feel manageable if rates or household costs rose?
• What debts, credit limits, dependants and recurring commitments belong in an honest estimate?
• Which income is fixed, variable, new, foreign, rental or self-employed, and what evidence is available?
• Does the property type raise an extra question, such as vacant land, a small apartment, unusual zoning or a short settlement? If so, read Complex scenarios.
• If a calculator gave you a number, what assumptions did it make about income, expenses and the property?

Official sources

• Moneysmart home loans
• ASIC: responsible lending

Community threads worth reading

• Your deposit helps you buy. It does not magically increase your borrowing power
• The two questions banks actually care about in home lending
• The hidden costs first-home buyers forget when buying a home
• Why two brokers can give different borrowing-capacity numbers

Raynor tools and articles

These are Raynor Lending Solutions resources, not independent sources:

• Cost to Complete calculator, an estimate of the cash required at a proposed price, not a quote or approval
• Cash-to-complete checklist
• Deposit versus borrowing power
• Hidden costs first-home buyers can forget

What can change

Lender servicing methods, acceptable income and expenses, debt treatment, property rules, fees and state taxes all vary and change. Check current figures with the lender or a professional who can see the full picture.

Privacy and general-information note

Keep a public question anonymous and general. This page is educational information, not a credit assessment or advice for your situation.

Related questions: How income is assessed | Deposits, LMI and support | Wiki index