All of us of course want a dream home of our own and work hard to try and get one. The problem is though that those homes are expensive and we may not always be able to afford them. In order to save us going through a great deal of hassle, just to find out that we cannot obtain the loan we need to buy the house of our dreams, some web sites now provide a home loan eligibility calculator. This is a calculator that will take into account all the information that a potential lender will, like a bank. By completing the details asked for on the calculator, you will be able to find out in advance, if your loan request is likely to be approved. Of course though, the calculator is only as good as the information which is given to it and so to be effective, you must be honest as, although the calculator cannot verify the information given to it, a potential lender certainly will.
When applying for a loan to buy a house, there are several factors that will be considered, first of course, the price of the house, or at least the size of the loan that is being requested and the actual value of the house. It is usual that any lending institute will not grant you a loan for more than up to 85% of the value of the property so will be expected to be able to provide the other 15%. The loan then will be paid back in monthly instalments which means the lender will want to take certain precautions to ensure that your income is sufficient to enable you to pay back each instalment every month. Obviously, nothing in this life is certain as you could lose your job or sustain an injury but, the lender will want to ensure that, at the time of the loan, you were earning sufficient income to pay back the loan.
One of the primary factors that the lender will look at in determining your eligibility for the loan will be your disposable income, sometimes referred to as your PDI (personal disposable income). This DPI is your total income, minus any necessary expenses or deductions, such as taxes. Another important factor that will probably be taken into consideration is your credit score. Your credit score is a number derived from your credit history and takes into consideration any loans you have received from an assortment of sources in the past, plus your shown ability to pay them.
Each different lending establishment will probably take these two considerations into account when determining you eligibility but, will also have certain criteria of their own which will need to be met. Although an eligibility calculator will not ensure you will get a lone, as most of the lending establishments have similar criteria, they are fairly accurate in providing a realistic assessment as to whether or not you will qualify for a loan.