Buying a home is a big step for anyone. Even for individuals or families with experience in home buying, making the decision to upgrade to a larger home or perhaps choose a newer home is still a big consideration.
One of the big concerns, particularly for first-time home buyers, is to ensure the home they choose is within their financial means. This is not as easy as applying for a mortgage and then buying a home at that price; there are a lot of factors that need to be considered to avoid ending up with payments that are impossible to make or that create financial hardships for the family.
Using a first-time home buyer mortgage calculator is an invaluable exercise. These online calculators are offered at no cost or obligation and allow first time buyers to try different financial options to see issues such as monthly payments, taxes, insurance payments as well as the possibility for mortgage insurance requirements.
Be Realistic
To get the most out of a first time home buyer mortgage calculator, it is important to be realistic with the numbers. A good place to start is in determining how much you can borrow. Use realistic information about monthly income and payments and don’t calculate in expected promotions or salary increases, use the actual figures you are working with currently for your budget.
Experiment with Numbers
The big advantage to using a first time home buyer mortgage calculator is the ability to see how differences in interest rates, terms of the loan, interest rates and even property taxes will impact the mortgage payments.
It should be easy to find information on tax rates, the appraised value of the home and even interest rates by talking to a mortgage specialist or doing some online research.
Using these tools will provide a general guideline to the cost of home ownership. Looking carefully at the budget as a whole will also be essential in selecting a home your budget range.
At Guaranteed Rate, we offer our handy first time home buyer mortgage calculator and other calculators to assist our clients in choosing a mortgage that is right for their budget.
