Mortgage Calculator - Mortgage Qualifier

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This free online mortgage calculator helps you determine how much you can afford given your financial burden. A mortgage qualifier calculator is an effective tool that helps you plan and time your investments according to your budget and financial constraints.

The basic parameters used to assess how much you can borrow are:

Monthly Family Income
Monthly Expenses (loan payments, credit card, etc.)
Monthly Property Tax
Other Monthly Expenses
Mortgage Rate of Interest
Mortgage Term

The above mentioned considerations put together help devise the following answers:

Maximum Mortgage Amount
Maximum Monthly Mortgage Payment ( Principal + Interest)

These calculations help you calculate the additional payments you will receive on a monthly basis. It also helps you determine what type of loan is available so that you may plan accordingly.

The mortgage qualifier tool also throws light on other important considerations such as:

Amortization Schedule
Mortgage Closing Costs
Funds available for Down payment
Total Purchase Price

To aid better understanding of common mortgage terminologies, a vivid description of terms used are also provided for the benefit of users.

The first step in buying a house is determining your budget. This calculator steps you through the process of finding out how much you can borrow. Fill in the entry fields and click on the "View Report" button to see a complete amortization schedule of your mortgage payments.

Mortgage Qualifier

An annual income of ANNUAL_INCOME may qualify you for LOAN_AMOUNT loan.

Using your input values, an annual income of ANNUAL_INCOME should enable you to carry a LENGTH_OF_LOAN-year mortgage at INTEREST_RATE in the amount of LOAN_AMOUNT. With a TOTAL_FOR_DOWNPAYMENT down payment, the total purchase price would be PURCHASE_PRICE. Total closing costs for this loan are estimated at TOTAL_CLOSING_COSTS.

Monthly payment TOTAL_MONTHLY_PAYMENT		Closing costs TOTAL_CLOSING_COSTS
Principal and interest	MONTHLY_PI	Fee for points	POINTS_PAID_AMT
PMI	MONTHLY_PMI	Origination fee	LOAN_ORIGINATION_AMT
Taxes	MONTHLY_TAXES	Other closing costs	OTHER_CLOSING_COSTS
Insurance	MONTHLY_INSURANCE

To avoid PMI payments a PERCENT_20_DOWN_AMT down payment is required. This equals PMI_PERCENT of your home's purchase price. The total amount of cash required for a PMI_PERCENT down payment plus closing costs would be CLOSING_COSTS_PLUS_20.

Qualify Calculation

The QLFY_AMOUNT monthly payment you could qualify for is calculated by taking the lower of these two calculations:

1.	Monthly Income X LOW_DEBT_PITI_RATE = monthly PITI	MONTHLY_INCOME X LOW_DEBT_PITI_RATE = QLFY_PITI_ONLY
2.	Monthly Income X HIGH_DEBT_PITI_RATE - Other loan payments = monthly PITI	MONTHLY_INCOME X HIGH_DEBT_PITI_RATE - TOTAL_LOAN_PAYMENTS = QLFY_PITI_DEBT

Payment Schedule

**REPEATING GROUP**

Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We can not and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

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Definitions

Annual income: Your annual income before taxes. For married couples this is your total combined annual income before taxes.
Purchase price: The price of the home you wish to purchase. This is the actual price you'll pay, not including any closing costs.
Total monthly payment: Total monthly payment that you can qualify for. This is the total of principal, interest, taxes and insurance paid each month. Often called PITI.
Cash on hand: Cash you have for the down payment and all closing costs.
Interest rate: The current interest rate you can receive on your mortgage.
Term in years: The number of years over which you will repay this loan. The most common mortgage terms are 15 years and 30 years.
Property tax rate: Your property tax rate. 1% for a $100,000 home equals $1,000 per year in property taxes.
Home insurance rate: Your homeowner's insurance rate. 0.5% for a $100,000 home equals $500 per year for homeowner's insurance.
Monthly car payment(s): Total monthly payment for your car loan(s).
Credit card payments: Total monthly minimum payments for your credit cards.
Other loan payments: Any other installment loan payments, such as student loans or unsecured loans.
Total closing costs: Total upfront costs to close your loan. This is the total of your loan origination fee, points paid and other closing costs.
Loan origination rate: The percentage the lending institution charges for its origination fee. 1% for a $100,000 home equals $1,000.
Number of points paid: The total number of points paid to reduce the interest rate of your mortgage. Each point costs 1% of your mortgage balance.
Other closing costs: Estimate of all other closing costs for this loan. This should include filing fees, appraiser fees and any other miscellaneous fees paid.
Monthly PMI payment: Monthly cost of Principal Mortgage Insurance (PMI). For loans secured with less than 20% down, PMI is estimated at 0.5% of your loan balance each year. Monthly PMI is calculated by multiplying your starting loan balance by this percent and dividing by 12. When the equity in your home exceeds the percentage required for PMI, your PMI payment drops to zero.
Monthly PI payment: Monthly principal and interest payment.
Total for down payment: Total funds remaining, after closing costs, for down payment.
Limit down payment: Limit your down payment to percentage required to eliminate the need for PMI payments. Even if you have more cash on hand than required for closing costs checking this box will limit your down payment to the minimum amount required to forego PMI.
Show schedule by month: Display the payment schedule by month when you press the Payment Schedule button.
Show schedule by year: Display the payment schedule by year when you press the Payment Schedule button.
Total annual income debt percentage: Not shown. This is the percentage of your annual income your financial institution allows you to use for debt installment payments. This includes car payments, credit card payments, other loan payments and your "Principal, Interest, Tax and Insurance" payment for your home. The default rate is 36%.
PITI annual income percentage: Not shown. This is the percentage of your annual income your financial institution allows you to use for your "Principal, Interest, Tax and Insurance" payment for your home. The default rate is 28%.
Qualify amount: Shown as "Total monthly payment." This is the total amount you qualify for per month. This amount is the total of "Principal, Interest, Tax and Insurance" for your home.

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