Owning a home is a huge step in your life and a major investment, but there are certain costs that are not listed on the housing contract.
Many Americans are looking to take advantage of historically low real estate prices, attractive mortgage rates, and the federal tax credit through the purchase of a home. But it’s important to remember that not all costs associated with homeownership are listed on the housing contract that is drawn up. Many first-time home buyers are surprised by how much more cash they need to set aside for housing-related expenses they had never considered. Don’t be caught off-guard when you buy a home with these hidden costs of owning a home.
The Hidden Costs of Owning a Home
- Appraisal fees
Before you can buy the home of your present dreams, your lender will need you to have the property valued. This is done by a professional real estate appraiser, and lenders use their data to determine the amount of money to offer mortgage borrowers. These aren’t free and usually range between $350 to $400.
- Closing costs
You know those almost unnecessary “service” fees that are added at the end of checkout when you purchase a ticket for a concert that really grinds your gears? Be prepared to pay thousands of dollars in fees–known as closing costs–when you are ready to finalize your home purchase.
- Property taxes and homeowners insurance
Your monthly premium won’t just be the monthly payment plus interest, it will also include property taxes and premiums for home insurance. Your monthly payment is known as “PITI,” or principal, interest, taxes, and insurance.
Protect your home with a quality homeowners insurance policy. All lenders require you to get a homeowners insurance policy before they lend you hundreds of thousands of dollars. Get more coverage for less by contacting Scautub Agency in Scotia, New York.