For many Australians, buying a home is a major milestone—but rising property prices and tight lending conditions can make the journey feel out of reach. The good news? Improving your mortgage affordability isn’t just possible—it’s strategic. With the right financial planning and expert advice, you can strengthen your position as a buyer and move into your new home sooner than you think.

Whether you’re exploring loan options, tightening your savings plan, or searching for the Top 10 mortgage brokers in Melbourne to guide you through the process, taking proactive steps today can dramatically improve your borrowing power tomorrow.

This guide outlines practical, proven strategies to boost your mortgage affordability and get you closer to securing the keys to your first (or next) home.

1. Understand What Affects Your Borrowing Capacity

Your borrowing power is influenced by several key factors that lenders evaluate when assessing your mortgage application:

• Income: Your salary or business earnings, including bonuses or commissions
• Expenses: Living costs, debt repayments, school fees, and other regular outgoings
• Credit score: A measure of your financial reliability
• Employment type: Full-time, part-time, contract, or self-employed
• Deposit size: The bigger your deposit, the less risk for the lender
• Existing liabilities: Credit cards, personal loans, car finance

Understanding these variables helps you identify areas for improvement so you can maximise how much you’re able to borrow.

2. Track and Trim Your Spending

Lenders assess your monthly expenses closely, especially in a post-2022 lending climate where responsible lending standards are under the microscope. To boost your affordability:

• Track spending using apps or spreadsheets
• Eliminate unnecessary subscriptions and dining out splurges
• Avoid new debt (especially BNPL services like Afterpay) in the 6–12 months before applying
• Cut credit card limits even if the balance is low—lenders factor in the full limit

Showing consistent, controlled spending behaviour builds confidence in your financial discipline.

3. Increase Your Income Where Possible

While easier said than done, even a modest income boost can make a meaningful difference in how much you can borrow. Options include:

• Taking on extra freelance work or overtime
• Starting a side hustle or small business
• Monetising unused skills or hobbies
• Negotiating a raise at your current job

If you’re a couple applying jointly, the combined income can also improve affordability, particularly if one partner is returning to work soon.

4. Use an Affordability Calculator

Before you even speak to a lender, it helps to have a rough idea of what you can afford based on your current finances. Try Loanscope’s what mortgage can I afford? calculator to input your income, expenses, and deposit size for an estimated borrowing capacity.

This will:

• Set realistic expectations
• Help you narrow your property search
• Give you a clearer picture before pre-approval

Online tools like these are a great starting point, especially if you’re unsure how much weight lenders give to various factors.

5. Strengthen Your Credit Score

Your credit score plays a major role in whether you’re approved and what rates you’re offered. To keep it healthy:

• Pay bills on time
• Avoid multiple loan applications in a short time
• Check your credit report for errors and fix them early
• Keep credit card utilisation below 30% of the limit

Many brokers recommend checking your score at least six months before applying for a loan so there’s time to address any issues.

6. Save a Larger Deposit

While you can often buy with a 5–10% deposit, aiming for 20% has key benefits:

• Avoids Lender’s Mortgage Insurance (LMI), saving you thousands
• Improves your loan-to-value ratio (LVR)
• Makes you a more attractive borrower
• Reduces your monthly repayments

Even an extra 5% can tip the scales when lenders compare your profile to others. Explore high-interest savings accounts or First Home Super Saver Schemes (FHSSS) to accelerate your savings growth.

7. Reduce Existing Debt First

The less debt you carry, the more income lenders see as available for repayments. Consider:

• Paying down personal loans or car finance early
• Consolidating debts to reduce interest
• Closing unused credit cards or reducing their limits
• Avoiding “interest-free” store finance deals before applying

Debt-to-income ratios are a key indicator lenders assess—lowering yours increases your borrowing potential.

8. Explore Government Schemes and Grants

If you’re a first-home buyer, there are several government initiatives that may help you get into the market sooner:

• First Home Guarantee (FHBG) – Buy with as little as 5% deposit without paying LMI
• First Home Owner Grant (FHOG) – Available in many states for new homes
• Stamp duty concessions – Save thousands on upfront costs
• Super Saver Scheme (FHSSS) – Use your super account to save a deposit faster

Check eligibility and conditions with a mortgage professional or your local state revenue office.

9. Get Expert Help Early

Navigating the lending landscape isn’t something you need to do alone. Working with a trusted mortgage broker gives you access to:

• Multiple lenders with competitive interest rates
• Personalised strategies to improve affordability
• Insight into lender policies and documentation
• Assistance with structuring your loan correctly

Loanscope, one of the top-rated mortgage brokers in Melbourne, offers tailored advice to help you improve your position and secure the best deal. They work with borrowers at all stages—from early planning to post-approval settlement.

Final Thoughts

Improving your mortgage affordability isn’t about shortcuts—it’s about strategy. By understanding the key factors lenders consider and taking steps to boost your financial health, you can buy sooner and with more confidence. From tracking spending to clearing debt and consulting the right experts, small changes today can open the door to big opportunities tomorrow.

Whether you’re a first-home buyer, an investor, or upgrading to your forever home, now is the time to take control of your mortgage future. With smart planning—and the right people by your side—you’ll be holding the keys in no time.