Who is US financial guru Dave Ramsey and why is his mortgage calculator so popular with Aussies?

Australians are turning to an American guru on mass for help with a major mortgage question.

Financial counsellor Dave Ramsey is a household name in the US, where he hosts a nationally syndicated – and wildly popular – radio program, on which he guides broke, stressed and monetarily confused Americans through the mire.

The Ramsey mortgage calculator is the most searched home loan tool among Australian home buyers, with huge numbers of Aussies turning to his kit box – instead of the big four banks – for clarity on how much they can borrow.

Remarkably, more Aussies have been going to his website to crunch mortgage numbers than locally-based calculators.

On his show, listeners call in with their financial problems and Ramsey, in his signature no-nonsense, tough-love approach, tells them exactly what they should and shouldn’t do to remedy crippling debt, start saving and achieve their goals.

Who is Dave Ramsey?

Tennessee-born Dave Ramsey is the host of the financial advice, talk-back radio program The Ramsey Show. There are three spin-off programs in his network.

Ramsey has written several books, including The Total Money Makeover, which became a New York Times bestseller, and hosted a television show for a few years until 2010.

He studied for a real estate license and sold property and, after gaining a degree in finance and real estate, started a financial counselling firm in the late 1980’s. This was born from his own experience of bankruptcy as a young man, and the recovery steps he successfully took.

Why is the Ramsey mortgage calculator so popular?

With 4.7 million Instagram followers and another 7.2 million on Facebook, it is not a surprise that Aussies have discovered and embraced his methods, too.

He has gained followers for his direct manner, in which excuses just won’t fly. Among his pet peeves are credit cards and expensive car loans, preferring his followers pay cash for a car they can outright afford. Some Americans confess to him to purchasing multiple vehicles, with a deep line of a credit, worth many times more than their annual salary.

Ramsey often says on his show that the most powerful “wealth building tool” is your income.

The mortgage calculator is in US dollars, but Australians can adjust the interest rate to suit, and currency convert the figures.

How much mortgage can I afford?

Dozens of banks and lenders provide calculators that test what you can repay, providing an overview of your borrowing capacity. It will differ slightly, depending on the rate they are offering.

Borrowing capacity – sometimes called borrowing power – refers to the amount a lender is happy to give you.

The lender measures this against how much of a risk you appear to be, and your financial obligations and position.