How Much Can I Borrow on a $120,000 Salary? (2026)
On a $120,000 salary, a payment budget equal to 30% of gross income mathematically amortises approximately $489,821 at 6.2% over 30 years. The 30% input is a budgeting heuristic, not a lender serviceability or approval rule.
Using a 30%-of-gross-income budgeting heuristic, a $120,000 salary maps to approximately $489,821 at 6.2% over 30 years and $3,000 per month. This is not a lender approval estimate.
What mortgage can I afford on $120k?
Within this 30%-of-gross-income budget model, 6.2% maps to about $489,821 and $3,000 per month. At 5.5% the same payment budget mathematically amortises $528,365; lenders use a buffered assessment rate and broader inputs.
How do interest rates affect borrowing power on $120k?
Interest rates significantly impact how much you can borrow. On a $120,000 salary, borrowing power ranges from $408,850 at 8% down to $528,365 at 5.5%. Each 0.5% rate change shifts capacity by roughly $27,990.
Is the 30% rule accurate for mortgage affordability?
The 30% rule is a household budgeting heuristic, not an Australian lending standard and not necessarily conservative for every household. Lenders assess verified income, living expenses, debts, deposit and other policy criteria at a buffered rate. Use our full Borrowing Power Calculator to enter your own comfortable payment and the current APRA buffer.
Need a more personalised estimate?
Our Borrowing Power Calculator factors in your existing debts, living expenses, and dependants for a more accurate estimate.
