Borrowing Capacity Calculator Nab Home Loan

NAB Max Formula:

\[ \text{NAB Max (AUD)} = \frac{\text{Income (AUD)}}{3\%} + 2\% \text{ buffer} \]

NAB Max (AUD):

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What is the NAB Max Formula?

The NAB Max formula is used by National Australia Bank to estimate the maximum borrowing capacity for home loans. It calculates the loan amount based on income assessment with a 3% interest rate assumption plus a 2% buffer.

2. How Does the Calculator Work?

The calculator uses the NAB Max formula:

\[ \text{NAB Max (AUD)} = \frac{\text{Income (AUD)}}{3\%} + 2\% \text{ buffer} \]

Where:

\( \text{Income} \) — Annual income in Australian Dollars (AUD)
\( 3\% \) — Interest rate assessment
\( 2\% \) — Buffer added for safety margin

Explanation: The formula calculates how much you could potentially borrow based on your income, using conservative interest rate assumptions to ensure affordability.

3. Importance of NAB Max Calculation

Details: Understanding your maximum borrowing capacity is crucial for home loan planning, budgeting, and determining what property price range you can afford in the Australian market.

4. Using the Calculator

Tips: Enter your annual income in Australian Dollars (AUD). The calculator will estimate your maximum borrowing capacity according to NAB's formula.

5. Frequently Asked Questions (FAQ)

Q1: Is this the exact amount I can borrow from NAB?
A: This is an estimate based on NAB's formula. Actual borrowing capacity may vary based on your specific financial circumstances, credit history, and current lending policies.

Q2: What factors affect my actual borrowing capacity?
A: Besides income, lenders consider expenses, existing debts, credit history, loan term, interest rate type, and the property value itself.

Q3: Does this calculation include other costs?
A: No, this calculation only estimates borrowing capacity. You should also consider additional costs like stamp duty, legal fees, and moving expenses.

Q4: How often does NAB update their borrowing criteria?
A: Lending criteria can change based on market conditions, regulatory requirements, and internal policy updates. It's best to consult with NAB directly for current information.

Q5: Can I use this calculator for investment properties?
A: While the basic formula may be similar, investment property loans often have different assessment criteria, including rental income considerations.