How Much Mortgage Can You Afford
If you want to purchase a new home, chances are you will need a mortgage. But, before you begin shopping, you need to determine exactly how much house you can afford. Nothing is worse than being turned down for a loan after you have found what you consider to be the perfect home.
Debt-to-Income Ratio
To determine the maximum mortgage amount that you can afford, most lenders use debt-to-income ratio guidelines. The term debt-to-income ratio is used to describe the percentage of your monthly income (before taxes) that is used to pay your monthly debts. In general, the common guideline for this ratio states that monthly mortgage costs should not account for more than 33% of your monthly income. And, when your other debts (credit cards, installment loans, etc) are added to the monthly mortgage payment, it should not consume more than 38% of your income altogether. For example, if your monthly income is $3,000, your maximum mortgage costs should be $990. When your consumer debt is added in, your monthly mortgage payment and your other credit expenditures should not exceed $1140 per month.
Making Your Own Calculations
Before consulting with a lender, you can make your own calculations. Begin by determining your monthly income. Only count income that can be documented by paperwork. The easiest way to do this is to locate your W-2s forms from the last two years. Add the amounts on the two forms together and divide by 24. This is your monthly income. Once you have that number, multiply it by 0.38. This is the maximum amount you can spend on mortgage payments and consumer debt combined.
Mortgage Calculators
To help you determine how much mortgage you can afford, you may also want to use a mortgage calculator. These calculators are readily available online and can help you evaluate different mortgage options. Here is a list of recommended Home Mortgage Lenders online. It’s important to use a reputable lender online to make sure your personal information is secure.
By: Carrie Reeder
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In order to obtain the right Residential Mortgage Loan, take a moment to search ABC Loan Guide. They even have lists of suggested lenders for a Bad Credit Mortgage Loan with Zero Down.
Categories: Mortgage Loans Tags: Home Mortgage Lenders, mortgage calculator, Mortgage Payment
Bi-weekly Mortgage Calculator
Doing the math for bi-weekly mortgages might be too much of a hassle for the regular home buyer. A bi-weekly mortgage is actually just your normal mortgage payment cut in half. Every other week, you pay one half of your normal mortgage payment.
Let’s say for instance you have a mortgage interest of 8% on your $100,000 home. By doing a bi-weekly mortgage on this instead of a 30-year loan, you can estimate with a bi-weekly mortgage rate calculator that the amount of your savings can reach up to $48,000. Plus, you can even make 13 full payments and pay off early on your home. Using a bi-weekly mortgage rate calculator, you can see that bi-weekly payments will cost you $50 each month.
The Internet is a smorgasbord of mortgage calculators, including bi-weekly mortgage rate calculators. Below is list of websites that feature bi-weekly mortgage rate calculators for free use by their consumers.
Reduce-My-Mortgage.com
Resourceintensive.com/2007/12/13/home-mortgage-information-and-guidance Mortgage Rate Calculator
The Reduce-My-Mortgage website offers a bi-weekly mortgage rate calculator that allows you to enter your personal information so you can start calculating your bi-weekly mortgage payments. Their bi-weekly mortgage rate calculator also helps you determine how much you can save in both time and money.
The site also features an update corner where bi-weekly mortgage buyers are told about recent mortgage news. These news like the home loan errors found out by the CLA (Consumer Loan Advocates) helps the consumer realize the importance of using a bi-weekly mortgage rate calculators. In addition to helping you calculate your savings, this bi-weekly mortgage rate calculator may also be sued on Automobile, Boat, Student, and Business loans.
Vlender.com Bi-Weekly Mortgage Rate Calculator
Virtual Lender is a Turkish website offering solutions such as bi-weekly mortgage rate calculators for either the individual loan officer or the entire mortgage company. Their bi-weekly mortgage rate calculator helps consumers determine the amount and projected period of loan payments.
1Stop-MortgageCalculator.com Bi-Weekly Mortgage Rate Calculator
This website offers a monthly and bi-weekly mortgage rate calculator to help you determine your payments. The only thing you need to do with the 1 Stop monthly and bi-weekly mortgage rate calculator is enter the principal loan into the field provided. After that, also type in the interest rate and the loan term into the bi-weekly mortgage rate calculator and find out how much your monthly payment will be. Also, this bi-weekly mortgage rate calculator will also let you know how much you save if you use bi-weekly payments.
DinkyTown.net Bi-Weekly Mortgage Rate Calculator
The bi-weekly mortgage rate calculator of this website will show you the possible savings you can make with your type of mortgage loan. Accelerated bi-weekly mortgage payment is the technique used by this bi-weekly mortgage rate calculator in order to determine the amount of savings. Bi-weekly payments usually work in only one way. They can accelerate your mortgage pay off by paying half of your normal monthly payment every two weeks. By the end of each year, you can see using a bi-weekly mortgage rate calculator that what you have paid for is equivalent to 13 monthly payments instead of 12. This technique used by this bi-weekly mortgage rate calculator can take several years off your mortgage term and also save you thousands of dollars in interest.
Categories: Mortgage Loans Tags: bi-weekly mortgage, Bi-Weekly Mortgage Rate Calculator, mortgage calculator
