Free Mortgage Calculators: Preparing for Mortgage Preapproval

If you're thinking about buying a home, getting mortgage pre approval can help you save time and possibly money. Mortgage lenders offer potential homeowners the opportunity to prequalify for mortgage financing before they begin shopping for a home. Recent developments in the mortgage industry are causing lenders to tighten lending standards, so it's important to be well prepared before shopping for a mortgage loan.

Free Mortgage Calculators are Easy to Use

You will need some information when using a free mortgage calculator. For a mortgage prequalification calculator, for example, you will need to provide your income, monthly expenses, and down payment amount. This information is used to determine how much home you can afford to buy. Other calculators can show you how different loan amounts and interest rates affect your mortgage payment. And still others can help you compare annual percentage rates (APRs) between different loan options. Choose the mortgage calculator you want to use, and enter the required information. Within seconds, the calculator will provide results!

The information you receive from free mortgage calculators may help you decide on a mortgage loan program or determine how much house you will buy.  Having some idea of where you stand financially is useful when contacting mortgage lenders. Although free mortgage calculator tools are designed to consider basic lender requirements for approving mortgage loans, each situation varies. Calculators provide a basic framework for mortgage shopping. However, you may be able to afford more or you may have to spend less. Mortgage lenders take into account the entire picture, including factors such as credit rating, length of employment, savings (called "reserves"), and down payment amount.

Paying the Bills Now and Later

Most mortgage loans have terms up to 30 years; and borrowers' situations may often change during this time -- planning for life's ups and downs can help make home ownership satisfying rather than worrisome. Owning a home also entails additional costs including property taxes and hazard insurance. Mortgage lending requirements are designed to consider this. Not only should you have adequate monthly income to meet lender's requirements, but making a significant down payment, and having some savings can improve chances of mortgage preapproval. If you can't afford the home you want now, free mortgage calculator tools can help you determine how much you need to earn and save achieve that goal.

mortgage prequalification calculator

Posted By :
Karen Lawson is a freelance writer with extensive background in mortgage banking. She holds BA and MA degrees in English from the University of Nevada, Reno.

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