3 Steps to Fixing Your Debt – The Free Mortgage Calculator

Debt can be stressful and if you’re not careful a nearly endless cycle. If you’re reading these words, then you’ve already made the decision to do something about it. Well, there’s plenty of help out there, most of which you can do on your own. Here are 3 steps to fixing your debt that can make this stressful situation a little more easy to bear.

First, get a free copy of your credit report. You can get one free credit report per year from all three credit reporting agencies, Equifax, Experion and Transunion. You can see on the report just what is damaging your credit and if you have any outstanding debts that you may have let slip by you.   Any bill that has gone unpaid, even for a short period of time can accrue interest and penalties. These not only add up to more debt that’s in turn hit with more interest and fees, the institution can raise your current interest rate when your credit rating drops.

When the credit card or other bills start rolling in, be aware there are two possible methods for paying them off. One is called laddering, where you pay the most on the bill with the highest interest rate, because carrying high interest debt will cost more. The other method is the debt snowball. Put the most money toward the smallest bill and pay the minimum on all others. When the smallest is paid, those payments are added to the next bill and so on.

Debt consolidation is also an option. But be careful, the debt doesn’t go away. You get a loan that covers your debt at a lower interest rate than you were paying. It can help reduce overall interest and you only pay one creditor instead of many.

These 3 are just a few of many methods you can try to fix your debt. Talking to professional is also a good idea. They can help you on your way to managing your debt. They can help you fix your debt and look into ways of buying a home based on your situation.

If You Think You Can’t Afford it; Chances Are You Can’t

The prospect of home ownership requires some serious financial soul searching. Before you even go shopping, you have to first figure out what you can afford. Maybe you’ve done this already and the prospects don’t look good. You know better than anyone and if you think you can’t afford it, chances are you can’t. The good news here is that there are some simple online tools that can help you make that decision. The tools are calculators that can determine your debt to income ratio, how much you can borrow and how much your mortgage will be and the term.

          First find a debt to income calculator, it’s the percentage of your gross monthly income that goes toward paying your debts. Input how much you make monthly and who you’re indebted to and for how much. Be sure to include all of your obligations such as mortgage payments, insurance and taxes, car payments-including taxes and insurance, credit card payments, student loans, alimony or child support. The lower percentage the better, it shows that you’ve been a good steward of your money and may qualify you for a better rate. A borrowing power calculator can determine how much you qualify to borrow based on your total income versus your debt obligations. You can use this in conjunction with a debt-to-income ratio calendar to help set goals and make you look as good as possible to lenders. Finally, you can calculate your mortgage by filling in the principal, interest rate and the term and you get an estimated monthly payment. You can compare interest rates, terms and varying down payments.

          If you’re dreaming about home ownership, online calculators are a great place to begin. You may be pleasantly surprised at what you can afford.