How Much Personal Loan Can You Afford?
A lender will tell you the maximum it is willing to give you. This calculator helps you work out the maximum you can sensibly handle — which is often less. It starts from your disposable income and deliberately keeps a buffer, because the most expensive personal loan is the one you cannot comfortably repay.
How Affordability Is Worked Out
Lenders must run a National Credit Act affordability assessment: they weigh your income against your living expenses and existing debt to confirm you can service a new repayment. This tool does a simplified version — your disposable income (income minus expenses minus existing debt), then commits only about 80% of it to a new instalment, leaving a margin for the unexpected.
Why the Rate Matters So Much
Personal loans are unsecured, so they carry far higher rates than a home or car loan — typically prime plus several percent, up to the NCA maximum for unsecured credit of repo plus 21%. A higher rate means a smaller loan for the same instalment and a great deal more interest. Your rate depends heavily on your credit record, so improving it before you apply can both increase what you can borrow and lower what it costs. Our guide to improving your credit score covers how.
Borrow Less Than the Maximum
The figure here is a ceiling, not a goal. Borrowing the full amount leaves no room for a rise in expenses, a change in rates, or an emergency. The cheapest personal loan is the smallest one over the shortest term you can manage — that is what keeps the total interest down. If you are borrowing to clear other debts, compare it against our debt consolidation calculator first.
More Free SA Finance Tools
- Personal Loan Calculator — the full repayment, NCA fees and credit life.
- Debt Consolidation Calculator — whether combining debts into one loan helps.
- Debt-to-Income Calculator — the affordability ratio lenders use.
- Guide: Improve Your Credit Score — get a better rate.
Disclaimer: Finance Atlas is not a registered Financial Services Provider (FSP). This calculator provides a guideline affordability estimate for educational purposes only and is not a credit approval or financial advice. What a lender will actually offer depends on its full National Credit Act affordability assessment, your credit profile and its own policy. Always confirm with a registered credit provider.