Borrowing Power Calculators
What are Borrowing Power Calculators
If you want to find out how much money you may be able to borrow from a lender to get a mortgage, a borrowing power calculator could be the ideal tool. They can help you to get a rough idea of the amount that you will be able to borrow by using the mortgage repayments calculation your bank uses - and this can be a huge bonus when deciding on the right home loan for you.
Many people use these online calculation tools to see what they can afford to borrow. What makes these calculators in particular even better is that many of them are free to use - and some websites even offer helpful information relating to mortgages, too.
How can they help me to see how much I can borrow?
With most borrowing power calculation tools you are required to enter some information, but they won’t need any personal details. They are likely to want to know about the loan (its term and type), the applicant (whether it’s just you alone or with a partner, your marital status and number of dependents) and your income and expenses.
Once you put in the necessary information, they can calculate how much a lender is likely to allow you to borrow. Remember that these calculators won’t be able to give you the exact amount that you will be able to borrow.
Generally, they will guess the lowest and highest amount that you are likely to be offered by banks and lenders. However, you could still get offered more or less by some, depending on certain circumstances.
Use a calculator before you search for properties
If you see how much a lender is likely to offer you before you look for properties, then you can search for houses within that price range. This way, you’ll know that you are more likely to be able to borrow the money that you need to buy that property.
It may be better to use these tools before you search for houses, but they can still be useful after, too. If you’re having trouble finding lenders who are willing to lend you the money that you want, then a borrowing power calculation tool can help you.
Talk to multiple lenders
When you have an idea of the amount that you may be able to borrow, you need to talk to some lenders to get a good mortgage deal.
Don’t worry if you don’t get offered the amount that you were originally hoping for, though. There are many lenders and they will all offer different deals. Keep on talking to lenders until you find one that is willing to offer you the amount that you are hoping for.
If lenders aren’t willing to lend you the money that you want to borrow, then it may be a better idea to find a cheaper property.