FHA home loans are the ultimate choice for first-time homebuyers as the loans allow for lower down payments and relayed credit scores. But like any other home loan programs, you would like to know how much house you can afford. Well, an FHA home loan calculator can help you with this.
Just enter the price you want to pay for a home, your interest rate, down payment, and years of the loan term and you will get the answer to your question. Besides this, with the FHA loan calculator, you can run a number of “what-if” scenarios. Have a look at the scenarios, before you use an FHA loan calculator Texas –
How long can I stay in the house?
Is it going to be your starter home or one where you want to spend the rest of your life? The answer to this question will help you determine whether you should consider a 30-year fixed-rate FHA loan or not. The longer the loan term the lower your monthly payment will be. However, you will pay a lot more interest in the long term. On the other hand, a 15-year fixed-rate mortgage will cut the total interest; however, your monthly payment will be higher.
Is an adjustable-rate mortgage a better option for me?
Well, there is no hard and fast rule whether an adjustable rate or a fixed rate a better choice for a homebuyer. It varies depending on the situation. If you want to stay in the home only for a few years, then an adjustable-rate will be the ideal choice for you. But if you want to stay there for a long time, then a fixed rate will be better for you. For instance, a 5/1 FHA ARM will offer you a lower initial interest rate, which is fixed for five years and then change annually after that. It can be the ideal loan solution for homebuyers who plan to stay in a home just for a couple of years.
Am I trying to purchase too much home?
The FHA mortgage calculator allows you to gut-check your home buying budget. It is because it considers your all-in monthly payments costs, along with FHA mortgage insurance premiums. It will ultimately help you by making you confident that you are looking for the right house at the right price for your income.
How much of a down payment should I come with?
It is a vital question, especially for FHA borrowers. While FHA allows you as little as a 3.5% down payment, with a down payment of 10% or more, your mortgage insurance premiums will end after 11 years. When you put down less, you have to confine with premiums for the life of the FHA loan. Moreover, you will have to refinance into a conventional mortgage to cancel it.
So, you will get the answer, if you want to check any of the above-mentioned scenarios. Do you have any other scenarios in mind? Check it and see the result now!
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.