Enter your monthly income and recurring expenses. Choose a target debt ratio (DTI), then set the duration and interest rate. The calculator estimates how much you could afford per month and the corresponding loan principal for a fixed-rate loan.
How this borrowing capacity calculator works
This free borrowing capacity calculator helps you estimate two key numbers before you start comparing properties or talking to a lender: your maximum affordable monthly loan payment and an indicative maximum loan amount. It is designed as a quick, privacy-friendly tool you can use on desktop or mobile. All computations run locally in your browser, which means the values you enter (income, expenses, interest rate) are not uploaded or stored by this page.
The first step is budgeting. You enter your monthly income and your monthly expenses. Expenses may include recurring fixed costs and/or existing debt payments. Then you choose a target debt-to-income ratio (DTI), expressed as a percentage. The calculator applies this ratio to your income to estimate a maximum “total monthly debt” amount. From that cap, it subtracts your declared expenses to estimate what could remain available for a new loan payment. If the result is zero or negative, it means that with the chosen ratio and your current expenses, there is no room for an additional monthly payment.
The second step converts that estimated monthly payment into a loan principal using a standard fixed-rate loan present-value formula. In simple terms, a longer duration usually increases the principal you can borrow for the same monthly payment, while a higher interest rate usually decreases it. This is an indicative estimate: real borrowing capacity depends on other elements such as borrower profile, lender rules, loan insurance, fees, down payment, taxes, and the required remaining disposable income after all charges.
Use this tool to compare scenarios: adjust the interest rate, change the duration, or test different debt ratios to see how sensitive your project is. For final decisions, always confirm with a qualified professional who can account for your complete situation and local lending requirements.
Disclaimer: simplified estimate only. It is not financial advice and does not replace a lender’s assessment.
What is this borrowing capacity calculator used for?
This borrowing capacity calculator is used to estimate how much you can reasonably afford to borrow based on your income, existing expenses, a chosen debt-to-income ratio, an interest rate, and a loan duration.
Who is this tool useful for?
- Home buyers preparing a real estate project
- Borrowers comparing scenarios before contacting a bank
- Couples or families planning a shared loan
- Students learning how loan affordability is estimated
Concrete examples
- Estimating how much you could borrow with a €3,500 monthly income
- Comparing a 20-year vs 25-year loan duration
- Seeing the impact of a higher interest rate on borrowing capacity
Common mistakes to avoid
- ❌ Forgetting to include existing monthly expenses or debts
- ❌ Assuming the result is a guaranteed bank approval
- ❌ Ignoring insurance, fees, and living costs
This tool provides an indicative estimate only and should be used as a planning aid rather than a final decision tool.
Limits and possible alternatives
This calculator uses a simplified affordability model. It does not include loan insurance, bank fees, taxes, variable interest rates, or lender-specific rules that may apply in real situations.
- Official simulations provided by banks or brokers
- Personalized financial advice from a qualified professional
Educational summary
In summary, this borrowing capacity calculator helps you estimate how much you could afford to borrow by linking income, expenses, debt ratio, interest rate, and duration. It is a practical first step to explore scenarios before engaging in a formal loan application.