Your Questions About Home Loan Calculator

James asks…

Quailfiing for a home loan?

I gross $3,400 a month,have a credit score in the low to mid 700s,no debt at all,and $15,000 in savings,with the way the enconmy is do you for see any problems with me getting a loan?,and approx how much would a bank lend me?

John answers:

With your income and credit score (good job btw) you can afford between $127,655.10-$133,425.64.

Http://www.citimortgage.com/Mortgage/Affordability/PostAffordability.do?td=id19129052|1

This is an easy calculator to use.

Lisa asks…

home buying help?

My husband and I found a house we like the only problem is it’s price is 186,000.. when I estimated how much of a home we would be able to afford I was told 150,000… the house has been sitting on the market for awhile by owner, and just recently went to a realtor.. do you think in the next month or so they would consider a offer of 150,000? there are alot of houses for sale in this area. 2 others on that same street… TIA!

Shawna

John answers:

Have you gone to lendor or just used a calculator online? Go and try to get pre-approved for a loan and see what you are given (be sure to find out the amount of the montly payments). The online calculators are all over the board – I’ve had a difference of $50,000 that we could borrow for a home loan. Once you are pre-approved, you will know exactly what you can get for a home loan. With that in hand, see what would be a reasonable offer for the home – comparables in the same area, possibly appraisal value. Use this information to make an offer. Going in too low may turn off a seller and they may just say no with no counter offer. You don’t want to start with your top dollar you are willing to pay, their will be negotiations involved so you’ll have to come up from your first offer.

Mary asks…

school loans help?

Well I am in a bit of a bind, when I went to school in N.Y. I thougth my father was going to help pay for my schooling, but he was making loans, I of course being a young adult hadn’t a clue what he was doing. I ended up getting 4 loans out for it. I wish at times he sat me down and spoke to me what the loans were for and how much I should be paying. After I graduated and saw that I had to pay two seperate payments one for 267 and another for 288, I freaked out, thought well I am going to need a better job and went back to school. Now at then I did finiacial aid and graduated. When I graduated then, I had a job until I got pregnant and was released because the a-hole of the boss made tons of excuses to let me go and I ended up having to put the loans on Forbarence. So now that I used all of the forbarence up, they want me to pay 500.00 for one and the other loan will be 675 That’s over 1,000 and I don’t make much. I tried negotiating with Sallie Mae but the refuse to help!
Is there any options I can do because I am so stressed out. I work 4 days a week and can’t afford a babysitter. My husband has a great job but he has his bills and loans. I want to pay them back but I keep telling them that I can only send 150 or 200 for now. But they just want there money. I understand that and I don’t want to chip them either. It’s been stressing me out so badly. I cry so much over this. I have desperately looked for a second job but no calls yet and pray that soon I will be working again. But still feel I can’t pay that every month. Please if anyone has any options on what I can do to lower the payments please let me know. I feel so helpless.
Oh I owe 53,000 in school loans. My father pays for one and my Godmother also pays for another. In which I argue with my father because most of the loans he did while I was in school in N.Y I just didn’t know. If I knew I would have def not gone to school at all. I have the other 2 laons. And one of my interest rate is 15%. Then the others are 8%.
Thank you for the posting, my husbands is not on my sallie mae. This is all mine. When I was 18 years old, I wanted to go to collage, but my father never really sat me down and explained the loan option and how much of payments I would be making. This is a lesson learned for me to explain to my children now. Honestly if he’d had, I would have rethinked my option on attending school period. At that time, I was just trying to please them by just going. I am not making any excuses, and I tell my dad time and time again I wished he’d had warned me, most 18 year olds don’t know this. It’s already a scary world to be on your own. But now I am an adult and this is why I am trying to find a way to try and pay them, I am not trying to run away from paying. Just need a way to lower the payments because I am struggeling. I’ve talked with Sallie Mae time and time again and they make it seem like there is no other option when I know there has to be.

John answers:

Welcome to borrower’s hell. Like the home buyer’s mortgage crisis that has led to a spiraling foreclosure rate, you’re in a situation where you borrowed far more money that you could have reasonably anticipated being able to repay.

It’s partially the lender’s fault, but not really. They took advantage of your blind eye to your own personal financial responsibility

I’m not lecturing you, I’m just pointing out that you are in a bind of your own making. You took out high interest rate loans for a large sum of money, and you figured you’d work out the payment part later. Obviously, you never sat down to think about how much it would cost to pay off these loans – and the humongous impact that that amount would have on your household budget.

When you start taking out loans, you sit down with a calculator and you say “Hey – if I’m going to borrow this amount, I’m going to have a payment of “so-and-so” dollars. Multiply that amount by 12 and that’s your annual student loan payment – oh, for 10 years or so. Is that 20% of your total income? 25%? 40%? Come on, who are you kidding? With mortgage or rent, car payments, food, clothing, utilities, diapers, insurance, taxes – all of those other obligations – how in the world can you expect to have 30 or 40 percent of your annual income left to pay educational loans for 10 years??

What can you do now? Well, the news certainly isn’t promising. Just like all the people who are losing their homes to foreclosure because they borrowed far more than they could ever hope to repay, there’s not much sympathy out there for student loan borrowers who made the same mistake. At least they can’t take your education away – you get to continue to using that – unlike the people who are losing the roof over their heads.

Sallie Mae has a number of payment plans for students who can’t afford to pay. See, the thing is, that thanks to changes in the bankruptcy laws, Sallie Mae will eventually get their money. They’d rather get it sooner, rather than later, and they’d rather get it without having to sue you, because that costs Sallie Mae time and money.

So – what are these plans – and are any of them your friend?

Let’s answer the 2nd question first. The answer is “NO!”. Any option that will save you money in the near term WILL cost you bundles of money in the long term. All these options represent is a temporary reduction in your monthly debt. In the end, you’ll pay a lot more for having had to resort to them.

But…you’re in a bind, and you can’t make your monthly payment, so there’s not much else available to you – let’s hold our noses and take a look:

There is the income sensitive repayment plan – If you choose this plan, you’ll pay Sallie Mae something between 4% and 25% of your monthly income – interestingly, the choice is up to you. The only rule is that the payment must be sufficient to cover the interest on your loan. That’s the minimum you can pay. As your income goes up, you’ll either have to pay more each month, or you’ll have to request another change in your payment plan.

There is also the Graduated Payment Plan. This one starts low – with low payments for the first FOUR YEARS. After year four, your payment jumps dramatically. Again, not an attractive option, unless you have some reason to believe that your income will jump dramatically in 4 years, too. If you’re finishing medical school, that’s probably true – otherwise – well, we’d all like to believe that our incomes will increase dramatically over the next four years, but very few of us would be willing to stake our financial future on it.

Finally, there is the Extended Repayment Plan. Probably the most enticing, and possibly the least sensible plan of all. Cut your monthly payment – how? By agreeing to make many, many more payments down the road. If you’re scheduled to make 120 payments now (10 years), maybe you’d like to be paying off your student loan in 20 years, instead. Could be a problem if your kids hope to go to college in 18 years’ time – you’ll get to add their loans on top of yours.

Next time you speak to Sallie Mae, tell them to cut the crap and that you want to speak to someone about changing your repayment plan. You don’t want a special dispensation, because you’re not going to get one.

When they make loans, they know for a fact that a certain percentage of the borrowers are going to have a hard time paying them back. That’s the nature of the lending business. Toyota knows that about the people they make car loans to, and Bank of America knows that about the people they make mortgage loans to. None of these lenders are going to “give you a break” and forget about some of the money you owe them, because bad things happened to you. They’re not cruel, they’re just business people, and business people gave you money, and now they want it back.

Tell the Sallie Mae rep that you want to shift to a different repayment plan, and demand that they send you a repayment schedule for the different plan options, so this time you can have SOME SENSE of what the heck you’re getting yourself into.

“My dad screwed me up” doesn’t work any more when you’re an adult with your own financial obligations. Unless your dad is willing to clean up this mess, you’re on your own with Sallie Mae.

I know this came off as a mean diatribe, but I’m just trying to communicate the reality. You’re in a mess – and there is absolutely no magic wand that’s going to make it go away. If you were injured in an accident, you’d find a way to overcome a physical handicap. This is a huge financial challenge, instead. It will take you a long time to pull yourself out of this mess, but if you make a firm commitment to get it done, not only will you reach your goal, but you will have the hard-worn battle scars that mark you as a dedicated and determined winner in life.

Good luck to you. I honestly mean that.

Carol asks…

Loan calculator online…?

Can anyone PLEASE tell me what to search for, or send me a link to a loan calculator that takes the principal, compounded interest rate, and time of the loan and tells me what the monthly payments will be??!??!?! I have No clue WHATSOEVER about how to calculate this. Please dont try to explain it, Ive tried dozens of times and Im pulling my hair trying to keep from jumping out my window
Please email me…
manthe42@yahoo.com

John answers:

I used this one

http://www.bankrate.com/calculators/mortgages/loan-calculator.aspx

pretty good, but usually i just call those broker up and have them explain it to me and give me a figure. There are usually hidden fee so better can and make sure every fee is included in the calculation

i just got myself a bridging loan for my home

William asks…

Student private loan issue?

I started to apply online at Chase for a private student loan. The info I provided about my school which is a community college the maximum I can borrow is $11,700, but when I calculated the total for cost of attendance my estimate was $17,760. When borrowing from a lender are all private loans based on cost of attendance at the school you will attend? I thought the max per year was up to $40,000 for a private loan?
Sorry, I forgot to mention $17,000 yr. isn’t the cost of my tuition, It would be the amount needed for me to pay rent, gas money to get me to school (40 minute drive) and other expenses. There isn’t any on campus housing for students and the rent for an apartment around here starts at 1200 a month.

John answers:

40,000 is a total for the entire school year which is July to July. Of each year. And most loan companies will based upon the school set the amounts you can borrow from them. Be sure to apply for any and all other financial aid for which you qualify for.

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Adv: $40,000 for $283/mo – apply online

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Paying for college with private loans
By Lucy Lazarony • Bankrate.com

For some college students, federal aid just isn’t enough.

After maxing out federal loans, more and more college students are turning to private loans to finance their college educations.

To get a good deal on a credit-based private loan you’ll need to shop carefully. Interest rates and fees vary widely. And you may need the help of a creditworthy co-borrower, such as a parent, to snag one of the better deals.

“It’s important for students to be as informed as possible,” says Ronald W. Johnson, financial aid director at the University of California at Los Angeles. “Don’t assume one private loan is like another.”

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College students borrowed over $56 billion in federal loans in the 2003-04 school year, and $11.3 billion in non-federal loans, according to the College Board.

Nellie Mae reports that while private loans make up only 9.2 percent of student aid, students that do turn to private loans are borrowing quite heavily. The average debt level of a student who borrowed with a private loan in their undergraduate years is a whopping $41,900.

“Many students are being compelled to take out private loans by outdated and insufficient federal student loans,” says Marie O’Malley, a vice president of marketing at Nellie Mae.

Rising cost, rising debt
Many students turn to private or alternative loans after exhausting federal borrowing options. Despite climbing college costs, the borrowing limit on federal Stafford loans has not increased in a decade. The Stafford program is the largest source of student loan funds in the country.

“It’s just simple math,” says Carl Buck, vice president of financial aid services for Peterson’s. “The cost of attendance, particularly at private institutions, has gone up significantly and you don’t have the federal aid programs increasing their maximum borrowing lines at all.”

Undergraduate students that depend on their parents for financial support may borrow $2,625 in Stafford loans in their freshman year, $3,500 in their sophomore years and $5,500 in their junior and senior years.

“Many students simply need to borrow more than that so they turn to private loans,” says Sandy Baum, a professor of economics at Skidmore College and co-author of a recent study on student loans. “They’re also turning to credit cards.”

Federal student loan borrowing limits may have been fine over 10 years ago. Back in 1992-93, public universities charged $2,334 in tuition and fees and private colleges charged $9,340.

Today, public universities charge an average of $5,132 (up 10.5 percent from last year) in tuition and fees. Four-year private colleges charge $20,082 (up 6 percent from last year) in tuition and fees. Toss in room-and-board expenses, and the total cost for a student, at a public university, averages $11,354 and at private colleges, $27,516. It’s easy to see how a college student could be stuck with a steep education bill even after taking out a federal loan.

PAGE 1 | 2

— Updated: July 15, 2005

Going to college when you’re older

Get ready! Cost of college is going up

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