How Much Home Loan Can you Afford?

One of the most stressful things on the list of responsibilities is purchasing a new home. Take a little bit of that stress off of your shoulders and work with Kloze lending to qualify for a loan and get into the house of your dreams. We have the best home loan rates in Boca Raton, Florida, and our goal is to get yours approved. It’s hard to know where to start and with so much information available, figuring out everything can be stressful and confusing. Before you get started on deciding what type of home loan you’re going to need you should figure out how much home you can afford. That’s easy enough by using the mortgage calculator on our site. Consider the house or cost of a home you’d like to have and you’ll enter that amount in the box marked home price. Determine the percentage per year interest rate you would like to pay and add that to the interest rate box. Let’s use this example: $500,000 home price at a 4.750 percent per year. Now, how long will it take you to pay off your mortgage, typically it is 30 years but 15-year loans are also available. For this example, we’re using a 30-year mortgage. Enter your down payment amount of $100,000 and the form will calculate how much your monthly mortgage will be. In the example we’re using here, your monthly mortgage would be $2,086.59. Your form will look similar to this:

Mortgage Calculator

Home Price $ 500,000
Interest Rate 4.750 %per year
Years 30
Down Payment $ 100,00
Monthly Payment $ 2,086.59

You can change any combination of the fields to calculate your monthly payment or change the down and monthly payments to get the best possible home price. You can see that buying a house is definitely not cheap, and finding a loan that’s right for you is a priority in your quest to get into your dream home. With home loans in Boca Raton, we teach you about the different types of loans and then figure out how much loan you can afford. To begin, you need to know you will have to put down a down payment, which is usually about 20 percent of your purchase price. We know that’s a lot of money; for instance, 20 percent of $500,000 is a substantial amount of money. In this instance you’ll want to consider a Federal Housing Assistance (FHA) loan. An FHA loan will assist you in getting the money you need without requiring a massive down payment; however, the requirements for approval are really strict. FHA is more of an insurer and it allows you to approach lending institutions because you have provided a guarantee that you will repay the loan and not default on it. With FHA loans you will pay a lower rate (below the 20 percent) as long as your credit score is at least a 580. Anything lower, like 500 to 579, means you will have to pay a higher down payment of at least 10 percent. With the higher credit score you will pay about 3.5 percent of the purchase price, which is why FHA loans are one of the most popular routes to take when purchasing a new home.

home loan rates in Boca Raton The FHA loan is only one of your choices; you have the option of a Fixed Rate Mortgage and an Adjustable Rate Mortgage. The Fixed Rate Mortgage is the most common type of home loan, and with this type of loan your interest rate will remain the same during the life of the loan. When you choose fixed rate it will be a 15- or 30-year variety. With an Adjustable Rate Mortgage the price may change quite a few times during the loan’s life. When making this choice you want to be sure that you can financially handle the changing housing market and what it will do to your monthly payments. Other loan options may be available to you if you qualify: Veterans Affairs Loans, Reverse Mortgages and Jumbo Loans. If you are a service person or veteran you can qualify for a VA loan, which is guaranteed by the U.S. Department of Veterans Affairs. These loans have very competitive fixed interest rates, no down payment and limited closing costs. Although they don’t issue the loan, they provide a certificate of eligibility that’s required in order to apply for a VA loan. The low-interest, reverse mortgage loan is reserved for senior homeowners so they can use their home’s equity as collateral. With this option, the loan amount is a percentage of the home’s value. It’s an appealing option for the senior population because the loan doesn’t have to be repaid until the last surviving homeowner has passed away or permanently moves out of the home. When that happens, the estate has about 12 months to repay the balance or sell the home in order to pay off the balance. Any remaining equity will be inherited by the estate. Also, the estate is not required to pay if the home sells for less than the balance on the reverse mortgage.