Home Mortgage Calculator - Tips for Getting Optimal Terms
The process of applying for home financing, being approved, and deciding if the financing terms work for your needs can be an overwhelming and confusing process. However, when you have a few simple facts in your pocket and a basic understanding of how it all works, then you'll find the process much easier and you'll feel more confident about the decisions you make.
Do the Banks REALLY Hold All the Power in Mortgage Negotiations?
We’ve got some good news and some bad news for you:
- The bad news is- interest rates in general depend on what the prime rate is, and also on your credit score. This means you will have to operate within those paramaters.
- The good news is- it barely takes any homework at all to walk into your mortgage negotiations understanding the process and feeling good about the outcome.
The Tool You Need to in Researching a Mortgage
An important tool you need is a home mortgage calculator. Using one of these calculators you will:
- Figure out the exact minimum and maximum amounts you can afford to pay every month.
- Learn how to reduce overall interest paid on your loan by choosing monthly payments greater than your minimum.
- Learn how much more money you will save paying your loan off faster rather than directly investing that extra money.
- Take responsibility for your financial life and decide for yourself what you want to pay on your loan.
Picking the Right Calculator
Make sure you use a home mortgage calculator with taxes built into it. Better yet, make sure that calculator also factors insurance payments into its formulations.
You can use a normal calculator to figure out the maximum amount of money you can afford to pay on your loan, only to learn too late (often at the negotiating table) that you can’t actually afford to pay that much every month because you didn’t take into account auxiliary costs, including taxes and insurance payments. Suddenly you realize your math is all wrong and you won’t be able to pay off your loan under as favorable terms as you hoped.
In this moment of confusion you may end up allowing the bank to steer you towards unfavorable mortgage terms. Take all expenses into account and know exactly what you are able afford every month.
Your Final Trump Card
Using this information you can walk into any mortgage negotiation with a level of confidence and assurance you never dreamed possible. But the greatest benefits of running the numbers yourself comes when you take the process one step further and begin to comparison shop among banks.
With your trusty home mortgage calculator in hand you will be able to figure out the exact amount of money you will pay over the life of every single loan offer you receive from every bank you petition. Which means you will know that even though Bank A’s terms sound better than Bank C’s, over the life of the loan Bank C’s mortgage will costs you tens of thousands of dollars less.
When it comes to gaining the loan you need to buy your house, a little bit of personal calculation goes a long, long way. Let us help with our online home mortgage calculator with taxes.