Buying a home is an exciting time, but it can also be very overwhelming. With so many houses to look at and options available, it’s easy to get side-tracked by details and lose sight of the bigger picture. Fortunately, plenty of real estate calculators out there make the process easier, thanks to the hard work of developers who have designed them to make life easier for homebuyers everywhere. Here are a few useful real estate calculators you should use when searching for your next home.
No home search is complete without understanding what you’re getting into. All lenders will use your estimated down payment, monthly income, and current debt to calculate your new home’s monthly mortgage payment. This can feel overwhelming when deciding between renting or buying. Luckily, the reality is that most of the math is done with just one click on a mortgage calculator!
Buy vs. Rent
Deciding whether or not to buy or rent a home can be difficult. It can be especially difficult if you don’t know how much either cost. Luckily, this is where real estate calculators come in handy! By plugging in different parameters such as your monthly payment, down payment, or current interest rate, these calculators will determine what it would cost you to buy vs. rent over time.
You’ll enter your monthly income, expenses, and debt payments for this real estate calculator. It will then calculate the maximum mortgage you can afford before getting into too much debt.
A family with an annual income of $80,000, $4,000 in monthly expenses, and $2,000 in debt could afford a $200,000 home loan. A family with an annual income of $100,000 could afford a $300,000 home loan.
If you are considering refinancing your mortgage, one of the first steps is requesting your most recent loan balance and term from your lender. An easy way to do this is to use an online real estate calculator. You must start with an accurate assessment of what your home could be worth if it were on the market today.
Closing Costs For Buyers
The expense of buying a home can vary depending on location, price, and amount of work needed. It is important to consider closing costs before you make an offer to ensure your budget will cover all the expenses. There are four categories of costs that buyers should be aware of:
(1) settlement fees – paid by the buyer at the time of closing
(2) loan origination fees
(3) title search and title insurance premiums
4) appraisals and inspections
Closing Costs For Sellers
While there is no way to know exactly what the costs will be upfront, the good news is that they are usually far less than you might expect. Most homebuyers should budget around 3% of the sales price as their total costs. When in doubt, don’t go it alone! A local agent will be able to break down closing costs and work with you on budgets and other financing options.
Real estate calculators are powerful tools that should be utilized when searching for a home. Understanding how to use the functions and benefits of these programs will help you make more informed buying decisions and provide you with valuable information that could one day save you money.