Being an owner of a house is a significant achievement, especially with the real estate prices being so expensive. Most people apply for home loan plans in order to afford property purchases. With a home loan, they get the financial assistance required and can then repay the loan over a period of 20 years. Now, applying for a home loan is a long-term decision, which is why it is important to carefully plan the repayment before doing so. You need to understand which loan plan is an affordable option, which is where a home loan affordability calculator can help.
This calculator will help in determining the amount that you can afford to pay off for the home loan on a monthly basis. This entire calculator requires is information regarding your monthly income, the house’s down payment, home loan interest rate, its repayment tenure, and any other EMIs being paid for existing loans. After getting these details, the calculator will help you in getting an understanding of your payback potential.
Take a look at the benefits of a home loan affordability calculator:
- Provides accurate results
It is advisable to make use of a home loan affordability calculator before you apply for home loan since this is a tool that can be relied upon. Planning your finances can get quite tricky, and even a slight mistake in manual calculations could lead to financial complications. This is why it is better to take the help of this home loan calculator as it always provides accurate results.
- Simple to operate
Not only does a home loan affordability calculator help in providing results that are accurate but is also really simple to use. All you need to do is adjust sliders of the fields that include down payment, monthly income, interest rate, tenure, and other EMI obligations. Once the information is provided, the calculator will then display the loan amount that can be afforded.
- Helps in choosing a suitable repayment tenure
You can try out different variations when it comes to choosing the home loan tenure. This will result in different loan amounts that you will be able to afford. This will help in finding a repayment tenure that is suitable to your budget and needs. With this, you will have a clear understanding of the finances with regards to both home loan eligibility as well as affordability.
So, after looking at the benefits that a home loan affordability calculator provides, it is considered best to make use of one before applying for a home loan. Now, many borrowers confuse this calculator with a home loan EMI calculator or a home loan eligibility calculator. Please note that each one is different; a home loan EMI calculator helps in calculating the monthly instalments of the loan, a home loan eligibility calculator helps in understanding the loan amount that a lender would be willing to approve based on your profile, and a home loan affordability calculator assists with finding right loan amount that is affordable.