What To Keep In Mind When Buying A Home

Making the decision to purchase a new home is not something you should go into blindly. Unfortunately, once you get past the downpayment and the seemingly endless closing costs, you will still need to factor in monthly expenses to keep your home operational and to maintain a personalized level of comfort.  

Land taxes

At the time of closing, you will need to pay for a portion of the taxes so that the lender has enough in escrow to pay your taxes in full by the due date. The amount you will need depends on the time of year you schedule your closing. If its right after the taxes are due you will only need to come up with a month or two. However, if it’s near the due date, then you will need to cover most of the year. In addition, to the initial payment given at the time of your closing, the bank will divide the remaining balance by the remaining months and tack that figure onto your mortgage payment. 

Utilities

Utilities such as gas, electric and water can consume up to 30 percent of your monthly budget. Before purchasing a home you should make sure that you have the additional monies available each month to cover these expenses. A good way to determine what the costs will be is to have your attorney or realtor ask the current owner to disclose this information. This way you’ll have a pretty good idea of what to expect. There are many ways to reduce these costs such as using energy-efficient appliances and turning down the furnace and raising the heat. 

Garbage

If you live in a community that has a home owner’s association (HOA) more than likely the garbage pick-up is already included. However, if you live in a private lot you will be responsible for paying for it out-of-pocket. You can check with the realtor to see who they use or if there’s anyone they recommend. Most times the monthly fee isn’t substantial but you will need to factor the expense into your budget. Another option that’s generally less expensive is to find the landfill near you and dump your garbage there. 

Cable or Satellite television 

When you first move into your new home you will want to have television and internet available. Luckily, there are many companies that offer these services. How much you pay depends on whether you want to go with basic service or have access to watching HBO, Cinemax, and Showtime. Many times if you bundle services you can save money. For example, this DIRECTV installation will include a one-time fee to install both your cable and your internet. From there you’ll receive a bill each month that includes both the cable fees and the internet fees with discounts revealed for bundling the services. It’s always best to shop around for your cable and internet services to see who has the best deals. 

Homeowner’s inspection

If you are using a bank for a mortgage a homeowner’s inspection is something they require. The fee can run anywhere from 500 to 600 hundred dollars and more. The importance of this inspection is to make sure that your home is sound. The inspector will check for things like cracks in the foundation, leaks in the plumbing, outdated electrical work and the integrity of the roof. The expense is well worth it since this also gives you a heads up before you sign the contract, allowing you to decide to back out or arrange for the homeowner to make the repairs prior to the closing. 

Regular Maintenance

Homeownership is a milestone that makes you feel a sense of accomplishment. However, once the closing is over its now your home and everything that comes along is another expense that falls squarely on your shoulders. If it’s a newer home the roof and plumbing should be intact, but items like lawn care are something that you will have to either do yourself or hire a professional to handle. Again, the fee itself is small; however, tacked on to everything else it could put you over your budget. If you don’t currently own a lawn mower you can buy a less expensive model to start with and avoid the monthly fee. The money you spend will pay for itself in a year or so. 

Buying a home is exciting. Just make sure before you go to contract that you have a clear understanding of all the costs involved. This way you won’t end up unable to afford your new home and run the risk of losing everything. 

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