farmcfo.com.au/tools/borrowing-capacity · 0412 759 847How much can I borrow?
Enter a normal year's farm profit, off-farm income, drawings, tax and the repayments you already make. The calculator works out the repayments the business could carry at the debt service cover you choose, the loan those repayments support at a tested rate, and the limit set by your security. The lower of the two is an indicative figure, not an approval.
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- Cash available for repayments
- $320,000
- Room for new repayments
- $106,000 a year
- Loan those repayments carry
- $1,038,225
- Limit from security
- $1,200,000
- Indicative new borrowing
- $1,038,225
- Repayment on that loan
- $8,193 a month
Profit plus off-farm income, less drawings and tax.
Repayments can total $256,000 at 1.25 times cover.
Tested at 8.23% over 20 years.
60% of security, less debt you have now.
The lower of the two. Limited by income.
At the 7.23% rate, before the test buffer.
The example is an invented mixed farm with a $420,000 average profit before interest, tax and depreciation, $30,000 off-farm income, $110,000 drawings, $20,000 tax and $150,000 of yearly repayments on $1.2 million of debt, and $4 million of security. The rate is the RBA average small business rate on new loans for August 2026 (7.23%) plus a 1 percentage point test buffer, over 20 years. The 1.25 times cover and 60% loan to value are examples only: every lender sets its own.
The working
- Cash available for repayments = farm profit before interest, tax and depreciation + off-farm income - drawings - tax.
- Total repayments allowed = cash available / the debt service cover the lender wants.
- Room for new repayments = total repayments allowed - repayments on debt you have now.
- Loan by income = the principal and interest loan those new repayments pay off over the term, at the interest rate plus the test buffer.
- Limit by security = security value x the lender's maximum loan to value - debt you have now.
- Indicative new borrowing = the lower of the two.
General information only. This calculator doesn't take account of your circumstances and isn't tax, credit or financial product advice. Check figures with your accountant before relying on them.
Want the numbers done for you?
Farm CFO builds the budget, the monthly cashflow and the tests your lender will run, at a fixed price.
Read next: Farm loans explained
Questions
Is this what the bank will lend me?
No. It's a rough guide to start the conversation. A lender looks at your history, the season, your security and its own policy, and sets its own cover ratio, test rate and loan to value.
Why take drawings and tax out first?
Because the family and the tax office are paid before the bank. Lenders want to see the business can make its repayments after those.
What profit figure should I use?
An average of the last three years from your financial statements, before interest, tax and depreciation. One good year can overstate what the business can carry.