How A Mortgage Calculator Can Save You Bundles Of Time

How a​ Mortgage Calculator Can Save you​ Bundles Of Time
A mortgage calculator is​ perhaps the​ most valuable tool for anyone shopping for a​ new home .​
The reason is​ because a​ mortgage calculator can provide a​ variety of​ different figures,​ including monthly payments,​ affordability and interest costs .​
a​ mortgage calculator allows an​ individual to​ input his/her monthly income,​ monthly debt payments and returns an​ estimated amount on​ how much he/she can borrow for a​ mortgage loan .​
This number is​ only an​ estimate and cannot be used as​ a​ guarantee,​ but it​ certainly gives a​ prospective homeowner the​ knowledge to​ move forward with plans for home ownership.
Anyone who enjoys surfing the​ web can find a​ mortgage calculator available at​ almost every lending website,​ especially those that offer multiple lender queries .​
Some good examples are Lending Tree and eLoan,​ both of​ which offer a​ free mortgage calculator .​
In addition,​ local banks and lending institutions may offer a​ mortgage calculator via their website for added convenience .​
Most shoppers enjoy using this tool to​ help better equip them for shopping for an​ affordable home.
The benefits to​ using a​ mortgage calculator are many and will give a​ new homebuyer a​ realistic look at​ his/her financial situation,​ how much they can afford,​ and the​ cost of​ payments .​
Monthly payment calculations are another benefit of​ using a​ mortgage calculator .​
Based on​ the​ purchase price of​ a​ home,​ individuals can enter the​ length of​ their desired loan and the​ estimated interest rate .​
In return,​ the​ mortgage calculator will provide estimated monthly payment amounts based on​ the​ information provided .​
In addition,​ the​ total cost of​ the​ home including interest can be figured,​ along with various loan terms and amounts.
Without a​ mortgage calculator,​ many first time homebuyers may go into the​ process without the​ proper knowledge or​ how much they can actually afford .​
In today’s market,​ an​ individual’s debt must not exceed 50% of​ their total monthly income if​ they wish to​ get the​ best interest rates .​
If their debt to​ income ratio is​ higher than 50%,​ the​ borrower may be labeled as​ high risk and suffer higher interest rates or,​ in​ some cases,​ may be denied a​ loan altogether .​
An example would be an​ individual who earns $4,​000.00 per month and wishes to​ purchase a​ home with monthly payments of​ $3,​000.00 .​
Because this number greatly exceeds 50% of​ the​ borrower’s take-home pay,​ he/she may be forced to​ find a​ home that is​ more affordable .​
The 50% debt to​ income ratio includes mortgage,​ auto and credit card payments.

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