Learn how to use a mortgage calculator whether you’re looking to buy or sell your home
The first question you should ask yourself before buying your very first home is “how much can I actually afford?” The quick answer is to use this useful online mortgage calculator to plug in your expenses to get a sense of what your monthly mortgage could be. There’s more than a number from the answer that the calculator gives you. It gives you a concept, and from this you should ask the following questions to make you more savvy about home buying.
- PMI payments . . . can you cancel them?
Private Mortgage Insurance is usually an additional cost to buyers who don’t put at least a 20 percent down payment. To stop paying this fee every month, you HAVE to owe less than 80 percent of the home value. You could qualify by either paying your home loan or see enough appreciation to meet the threshold.
- Rent or buy?
There’s more to owning a home than swapping rent for a mortgage payment. You have to consider costs like property taxes, and, depending on where you live, the costs of private mortgage insurance.
- Can you pay off your mortgage early?
Begin by plugging in your original loan amount, interest rate, and the date the loan was issued. You can now play around with the numbers, taking a little bit off here, adding a bit more over there, you get the idea. Try to stay within the possibility of realism, and figure out how fast you’ll be able to pay off your home.
Understanding exactly how much home you can afford can be tricky, so it pays to get help. To make sure you choose a home you can afford long-term, contact Andraya Coulter in Walnut Creek. I serve homebuyers in California and Texas and am dedicated to helping you make the most educated, best decision for you and your family today and for the future!