Borrowing Capacity Calculator Commonwealth Bank

CommBank Max Calculation:

\[ \text{Max Borrowing Capacity} = \frac{\text{Annual Income}}{0.035} \]

Maximum Borrowing Capacity:

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1. What Is The CommBank Max Calculation?

The CommBank Max calculation estimates the maximum borrowing capacity based on annual income using Commonwealth Bank's standard assessment rate of 3.5%. This provides a preliminary indication of how much you might be able to borrow.

2. How Does The Calculator Work?

The calculator uses the CommBank Max formula:

\[ \text{Max Borrowing Capacity} = \frac{\text{Annual Income}}{0.035} \]

Where:

Annual Income — Your total yearly income before tax (AUD)
0.035 — Commonwealth Bank's standard assessment rate (3.5%)

Explanation: This calculation divides your annual income by 3.5% to estimate your maximum borrowing capacity based on Commonwealth Bank's lending criteria.

3. Importance Of Borrowing Capacity Calculation

Details: Understanding your borrowing capacity is essential for financial planning, home buying decisions, and determining what property price range you can afford when considering a mortgage with Commonwealth Bank.

4. Using The Calculator

Tips: Enter your annual income in Australian dollars. The calculator will estimate your maximum borrowing capacity based on Commonwealth Bank's standard assessment rate of 3.5%.

5. Frequently Asked Questions (FAQ)

Q1: Is this calculation definitive for Commonwealth Bank loans?
A: This provides an estimate only. Actual borrowing capacity may vary based on individual circumstances, expenses, credit history, and current lending policies.

Q2: What factors affect my actual borrowing capacity?
A: Besides income, factors include existing debts, living expenses, credit history, loan term, interest rate type, and number of dependents.

Q3: Does this calculation include other costs of buying property?
A: No, this estimate doesn't include additional costs like stamp duty, legal fees, or lenders mortgage insurance which should be considered in your budget.

Q4: How often does Commonwealth Bank update their assessment rates?
A: Assessment rates may change based on market conditions and regulatory requirements. Always check with Commonwealth Bank for current rates.

Q5: Should I use this calculation for financial planning?
A: This provides a useful estimate, but for accurate financial planning, consult with a Commonwealth Bank lending specialist or financial advisor.