There are only about 58.6 million online mortgage calculators available today. (At least that is what Google told me!) and that means there are millions of sources for misinformation for our customers. In fact some of these inaccurate calculators are built right into Real Estate’s most visited sites like REALTOR.com and others.
In all actuality these calculators are accurate at what they do, the true problem lies in what our customers think they do and what they actually do. See many customers log on in hopes to find what there “house payment going to be?” Yet to get what I call a “True Total Monthly Investment” you need to know about the property more, something that these online tools do not take into consideration.
Instead, these online mortgage payment calculators accurately display what the principal and interest would be monthly, for someone. They do not go into insurances, taxes and if any community or association fees may exist. Much of that information will vary based on the property and even the customer's financial qualifications.
The challenge is that when someone see they can own a $200,000 home with the right amount of money down for only $800 a month, Customers believe it. Then when you come in to work with them and you show them that yes, that is the principal and interest in their case but due to insurances, property taxes and other items their true investment is now over $1,300 a month. It get the customers a bit overwhelmed.
Yet even with the concerns I have over these calculators and knowing that many customers feel they are the old “bait and switch” treatment, I don't believe they are a bad thing. For example I did meet a potential customer who thought her payment would be $800 a month, that I never would have met if the online calculator she used showed her a payment over $1,300. That customer is now aware of here true total monthly investment as well as I have also shown her how some tax advantages would help too. Without these calculators I would not have even had a chance to help.
Share your opinion. How do you see these online calculators helping or hurting your efforts with customers or what would you change about them. Explain what you do by posting your comments below.
It is true that not all online mortgage calculators will provide you with the correct information. These online mortgage calculators will just give you an idea as to how much loan you will be able to afford. They will also give you an idea about refinancing, your debt to income ratio, tax savings, retirement planning, etc. But the data provided by these online mortgage calculators should be considered as an approximation. They are not the correct data. In order to get a correct estimation, the borrowers should always have a word with the lenders.
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