Your new home loan: Strategies for buying a home in 2011

Buying a home is the most significant financial transaction for many. As with any project, the outcome depends on preparation and having the right tools for making important decisions. How well you prepare and craft the details of selecting a new home loan can determine the outcome of buying and financing a new home.

Shopping for home loans: Using online mortgage calculators

Mortgage calculation tools can help with estimating critical aspects of your home purchase. You can use a mortgage comparison calculator for comparing mortgage quotes, or use a mortgage amortization calculator for estimating potential savings on a mortgage with a shorter repayment term. Establishing how much you can afford to borrow based on your desired monthly mortgage payment is a great place to start. The mortgage affordability calculator can provide an estimate based on principal and interest payments only; don't forget to include estimates for paying property taxes, mortgage insurance and hazard insurance in your affordability calculations.

Mortgage rates comparatively low, housing prices stagnant in many areas

The combined effects of low mortgage rates and sluggish housing markets are providing buyers with significant opportunities for buying homes they want at affordable terms. Contact real estate pros in the area where you want to buy your next home to learn about home prices. Based on estimated home prices and your available funds for your down payment and closing costs. you can estimate how much you'll need to borrow.

Requesting multiple mortgage quotes is important for comparing mortgages and their costs. Identify your best mortgage quotes, and make note of any questions. Contact mortgage lenders for details and answers to your questions. Getting approved for a mortgage prior to shopping for your new home can provide buying power as sellers will know that closing won't be delayed and your offer won't fall through due to problems with mortgage approval. Of course, completing a home sale depends on many contingencies, but locking in your mortgage rate and loan approval are important steps toward buying your next home.

Reviewing your credit, financial preparedness, and shopping mortgage terms can help with buying a new home in the new year.