Mortgage qualifying calculators can be great tools to assist potential homebuyers in figuring out how much money they may qualify for when purchasing a home. It is important to keep in mind that qualifying calculators are not guarantees of loan approvals nor of the amount a loan will be approved for, but instead act as an estimation for informational purposes only.
Buying a Home
One of the first steps when starting the process of shopping for a home is to get preapproved for a mortgage loan. This enables the potential buyers to know how much money they qualify to borrow, which also tells them what the maximum purchase price they can afford to look for when shopping for a home.
This is an important step because potential buyers do not want to waste time looking at homes with purchase prices that they cannot qualify for. Obtaining preapproval for a loan can also speed up the process involved with purchasing a home and can make the bid to purchase the home seem more appealing to sellers since financing is already in place.
The process of getting preapproved for a mortgage loan involves submitting a mortgage application and can mean going through the entire process of credit reviews, documentation submittal, and fees. Not every potential buyer is ready to go through this process and would prefer to get a broad idea of how much money they will probably qualify for. Mortgage qualifying calculators are ideal for this situation because the calculators will estimate the amount of money the potential borrower will probably qualify for based on the criteria set by mortgage lenders.
Information for Mortgage Qualifying Calculators
Mortgage lenders have certain standards that specify how much money an applicant will qualify to borrow for the purchase of a home. While there are many qualifying factors that have a huge impact on a person's ability to get approved for a home that are not taken into consideration on a mortgage qualification calculator -such as the applicant's credit score- the calculator can give a good estimate of how much money a person can obtain for a home purchase.
The qualification results from mortgage calculators are based largely on the debt to income ratio of the applicant. In very broad terms, the lower the debt to income ratio, the more money a person may qualify for when applying for a mortgage. Be prepared to offer the following information when completing a calculator designed to estimate the potential amount of money you may be able to obtain for a mortgage:
- Current income
- Current recurring debt obligations
- The amount of the down payment you will make
- The interest rate you expect to be charged for the mortgage
- The approximate real estate taxes of the area where the home is located
- An approximation of the homeowners insurance you will have to pay
Most calculators will estimate some of the information for you, such as the interest rate of the loan, the real estate taxes and the insurance amounts, but if you have this information already available you should input it for the most reliable estimate. The more accurate the information you provide, the more accurate estimate you will receive from the calculator.
Remember that the estimates are assuming that you qualify for a mortgage based on other factors including your credit score, employment history, and other factors the lender will take into consideration.
If you already know what mortgage lender you would like to obtain your loan from, visit the lender's official website to use the calculator if it is available.
If your lender does not provide mortgage qualifying calculators, or if you have not yet decided on a specific lender yet, try one of the qualifying calculators listed below: