How Much Is Your Borrowing Power in 2026

For first home buyers and existing homeowners in Bathurst and Lithgow, one of the most important questions to answer at the start of 2026 is: how much can you borrow?

Your borrowing power determines not only what properties you can consider, but also how confidently you can plan your next move, whether that is buying your first home, upgrading, or refinancing. 

Borrowing power is not a fixed number. It changes based on interest rates, lending policies, your income, your expenses, and even how you manage your everyday spending.  

Understanding your borrowing power early in the year can help you make informed decisions, avoid wasted time, and position yourself to move quickly when the right opportunity arises. 

What Is Borrowing Power and Why It Matters in 2026 

Borrowing power refers to the highest amount a lender may be willing to lend you, based on an assessment of your financial situation. In 2026, lenders continue to apply detailed serviceability checks, meaning they look closely at: 

• Your income and employment stability 

• Your living expenses and lifestyle spending 

• Existing debts such as credit cards, personal loans, and car finance 

• Your deposit and savings history 

• Current interest rates and lender buffers 

Understanding your borrowing power early allows you to search for properties within a realistic price range. This helps prevent disappointment later in the process and reduces the risk of making offers on homes that are outside your financial reach. 

How Borrowing Power Is Calculated by Lenders 

Lenders assess borrowing power using serviceability models that test whether you can comfortably afford repayments not just at today’s interest rates, but also if rates rise in the future.

This means your borrowing power may be lower than what you expect, even if your current repayments would be manageable. 

Your borrowing power is influenced by several key factors: 

• Income: Base salary, overtime, bonuses, and secondary income 

• Expenses: Everyday spending, dependants, lifestyle costs 

• Debts: Credit cards, buy now pay later services, personal loans 

• Interest rates: Higher assessment rates reduce borrowing power 

• Loan term: Shorter loan terms can reduce borrowing power 

For buyers in Bathurst and Lithgow, understanding how these factors interact can help you prepare smarter and prevent unnecessary delays. 

Why Borrowing Power Can Change in 2026 

Borrowing power is not static. It can shift throughout the year due to changes in interest rates, lending policies, and your personal circumstances. In 2026, factors that may impact borrowing power include: 

• Changes to interest rates by the Reserve Bank 

• Changes to lender serviceability buffers 

• Updates to household expenses benchmarks 

• Changes in your income, employment, or debt levels 

This is why checking your borrowing power early in the year is valuable. It gives you a clear baseline and allows you to track how small changes, such as paying off a credit card or reducing discretionary spending, can improve your position over time. 

How First Home Buyers Can Improve Borrowing Power 

For first home buyers in Bathurst and Lithgow, improving borrowing power can make the difference between buying sooner or having to wait longer. Simple steps can have a meaningful impact: 

• Reduce or close unused credit cards 

• Pay down high-interest debts 

• Demonstrate consistent savings habits 

• Review and streamline monthly expenses 

• Avoid taking on new finance before applying for a home loan 

Improving borrowing power is not about cutting out everything you enjoy. It is about presenting a clean and stable financial profile to lenders, which can lead to stronger loan options and better long-term outcomes. 

Borrowing Power for Homeowners Considering Refinancing or Upgrading 

Existing homeowners may be looking to refinance, upgrade, or access equity in 2026. Borrowing power still plays a key role in these decisions. Even if you already have a home loan, lenders will reassess your current financial position when you apply for a new loan or refinance. 

Understanding your borrowing power early allows you to: 

• Assess whether upgrading is financially realistic 

• Understand how much equity you may be able to access 

• Compare refinancing options with confidence 

• Plan renovations or investment strategies with clarity 

For many homeowners in regional NSW, reviewing borrowing power early in the year provides a clearer picture of what is possible before committing to any major financial changes. 

Why Getting a Borrowing Power Assessment Early Makes Sense

 

Many buyers pause until they have found a property before checking their borrowing power. This can lead to rushed decisions, missed opportunities, or the need to renegotiate expectations late in the process. 

Understanding your borrowing power early helps you: 

• Set a realistic property budget 

• Strengthen your position when negotiating 

• Move quickly when the right property appears 

• Avoid wasted costs on inspections or contracts you cannot complete 

It also allows time to improve your position if needed, rather than discovering limitations when you are already emotionally invested in a particular property. 

How a Mortgage Broker Can Help Clarify Your Borrowing Power

Calculating borrowing power accurately is more complex than using an online calculator. Different lenders assess income, expenses, and debts differently, which means your borrowing power can vary significantly between banks. 

A mortgage broker can: 

• Compare borrowing power across multiple lenders 

• Identify which lenders are more suitable for your situation 

• Model different scenarios based on your goals 

• Highlight simple steps to improve your borrowing power 

• Align your borrowing power with available grants and schemes 

For first home buyers and homeowners in Bathurst and Lithgow, local market knowledge can also help ensure your borrowing strategy aligns with realistic property values in the area. 

Start 2026 With Clarity Around Your Borrowing Power 

Understanding your borrowing power early in 2026 is one of the smartest steps you can take if you are planning to buy, refinance, or upgrade this year. It provides clarity, reduces uncertainty, and allows you to make confident decisions in a changing market. 

Rather than guessing what you can afford, a clear borrowing power assessment gives you a solid foundation for your property plans. For buyers and homeowners in Bathurst and Lithgow, early preparation can save time, reduce stress, and put you in a stronger position to achieve your goals in 2026. 

If you are thinking about making a move this year, understanding your borrowing power now can help you start the process with confidence and direction.