The purpose of an affordability calculator is to help prospective buyers figure out how much money they can afford to spend on a home. In addition to giving you an idea of the best house price range for your situation, most real estate calculators will also give you estimates of monthly payments on your home including taxes, mortgage insurance, and homeowners coverage. If the payment conclusion for the price range you thought you could afford actually seems beyond your reach, you can simply enter new numbers to determine payments based on different purchase prices, down payment amounts, and other variables.
Using a Real Estate Calculator
The best time to use an affordability calculator is when you first start shopping for a home to purchase. When you know how much house you can afford to buy at the outset of the real estate browsing process you can then target your search to properties that are within your financial means. You can save yourself and your Realtor a significant amount of time and energy if you make a decision about the best price range for your situation early in the process of shopping for a home.
More Free House Affordability Calculators
There are many different real estate purchase calculators available for use. Most calculators utilize the same basic formula for helping buyers figure out how much they can invest in real estate, but the calculators don't all work in exactly the same manner.
When you're trying to make a decision about purchasing a home it's a good idea to run your information through several different calculators. You are likely to find some variety from one calculator to another. Using more than one program can help you come up with a good average to use when setting the upper limit for the amount you are willing and able to spend on a home.
Some free online house affordability calculators you may want to utilize include:
- CNN Money
- Home Fair
- RealEstateJournal.com (The Wall Street Journal Guide to Property)
- Virtual Lender
Using Affordability Calculators with Caution
These types of investment tools can be very helpful in allowing buyers who are uncertain of how much house they can afford to pinpoint an appropriate buying range. However, it is important to remember that the calculators provide only general guidelines designed to help steer buyers in the right direction.
Many factors other than the ones considered in a calculator program's algorithm have an impact on the amount of money you can invest in your home. No matter what a calculator indicates that you can afford, make absolutely certain that you really can comfortably make the total monthly payment every month before you sign a purchase agreement or close on a loan. You know how much money you have available to pay your bills every month, so it's important for you to make a wise purchase decision based on all the facts.