Credit Card Impact Calculator

See how your credit card limits affect your mortgage borrowing power

Important: Banks assess your credit card limit, not your current balance. Even if you pay off your card each month, the full limit reduces your borrowing capacity.

Credit Limit Per Card

Number of Credit Cards

Current Balance (for reference)

Note: Banks use the limit, not the balance

Annual Income

Bank Test Rate (%)

Banks typically test at 7-8%

Borrowing Power Reduction

$85,811

Based on $20,000 total credit limit

Potential Gain if Limits Reduced

$77,230

By reducing limits to $2,000 total

Assumed Monthly Payment

$600

3% of total limit

Total Credit Available

$20,000

Quick Actions to Improve Borrowing

• Request credit limit reductions on all cards
• Cancel unused credit cards
• Pay off and close store cards
• Avoid Buy Now Pay Later services

How Banks Calculate Credit Card Impact

Banks assume you could max out your credit cards at any time. They calculate a hypothetical repayment (typically 3-5% of the limit) and subtract this from your available income for mortgage servicing.

Example: A $20,000 credit limit = $600/month assumed payment = approximately $$85,811 less you can borrow on a mortgage.

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Actual loan terms, rates, and eligibility may vary. Please contact a Mortgage Lab adviser for personalised advice.