Maximum loan you can service after existing debts.
Maximum loan
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Affordable instalment
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Total interest
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What a lender is really checking
Before a bank or a registered credit provider hands over a cent, the National Credit Act forces it to run an affordability assessment. The question is not "can you make the first payment", it is "can you service this debt for the whole term without stretching past breaking point". This tool answers a narrower version of that question from your side of the desk: given what is left after your existing commitments, how big a loan can a sensible instalment actually support?
It works in two moves. First it takes your net monthly income, subtracts the debt repayments you already carry, and reserves a share of what remains for the new loan. This calculator reserves 30 percent of that disposable amount, which is a common rule of thumb rather than a legal limit, so treat it as a guardrail you can tighten. Second, it runs standard amortisation in reverse: instead of asking what a known loan costs per month, it asks what loan size that affordable instalment can carry over your chosen term and interest rate.
Reading the affordable instalment first
The instalment figure is the heart of it, and it is worth pausing on before you look at the loan size. If your income is R30,000 and you already pay R6,000 toward other debt, your disposable income is R24,000. Reserve 30 percent of that and you get R7,200 a month for a new repayment. Everything else flows from this number, so if it looks too high or too low for your real budget, change the income, the debts, or treat the 30 percent as your own personal ceiling and aim below it.
A R7,200 instalment, turned into a loan
Take the defaults the calculator loads: R30,000 income, R6,000 existing repayments, a 15 percent annual rate, over 60 months. Inverting the amortisation formula at a monthly rate of 1.25 percent gives the largest loan that R7,200 a month can clear in five years. The numbers below use the rates this calculator applies, not a quote from any specific lender.
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That gap between the R302,649 you borrow and the R432,000 you repay is the part people skip over. You are paying roughly R129,000 in interest to access about R303,000 of credit, and that is at 15 percent. The chart shows how the same affordable instalment supports a smaller loan as the rate climbs, which is why an interest rate quote moves your borrowing power more than most buyers expect.
Where the estimate and the bank will disagree
A lender does not see your real budget the way you do. It pulls your credit bureau record, counts repayments you may have forgotten, and often uses gross income with a prescribed living-expense table rather than your true net. So this tool can show a loan the bank declines, or occasionally one it would beat. The number to trust is the smaller of the two: yours and theirs. A practical habit is to leave at least 10 percent of the headroom unused, because the model assumes nothing else changes for the full term, and life rarely cooperates.
One common mistake is treating the maximum as a target. The fact that R7,200 a month can carry a R300,000 loan does not mean you should borrow R300,000. Interest is a cost, not a feature, and a shorter term at a lower amount almost always serves you better than maxing out the affordability line.
Does a longer term let me borrow more?
Yes, and that is exactly why long terms are tempting and dangerous. Stretching from 60 to 84 months lets the same instalment support a noticeably larger loan, because the repayments are spread thinner. The catch is that you pay interest for two extra years, so the total cost climbs even though each month feels lighter. Lengthen the term only if the monthly figure is genuinely unaffordable, not to chase a bigger headline loan.
Should I use my gross or net income here?
Use net, the amount that actually lands in your account after PAYE, UIF, and any deductions. The 30 percent share is meant to come out of money you can really spend. If you enter gross income you will overstate your headroom, because the tax and contributions are already spoken for before you ever see them.