Home ownership: Know all the expenses that are obvious

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By: sanderspatricia29
on 6th Sep,2015

Checkout the expenses on which you must focus before you purchase a new home.

If you are planning to purchase a dream home for yourself, then you've to be quite serious as you are making the biggest investment of your life. If you are buying home for the first time, then it’ll be quite difficult for you to know the actual expenses which are quite common for a homeowner. But before you buy a home, you need to consider lots of factors such as the current mortgage rates on the market, the condition of the home, extra expenses and many more. From this article, you may get some idea about those expenses which are quite common for a homeowner. Read more to know in detail.

Expenses which are obvious to own a home

Read on to know the expenses on which you must focus before you purchase a new home.

1. Type of home

When you’ll search online, you’ll find several properties such as traditional single-family home, a townhouse, a condo or a multifamily building with two to four units. You must research properly so as to know the advantage and disadvantages of the properties. Most of the expenses depend on the type of home you are planning to buy.

2. Features of your home

Since you are spending money to purchase the biggest asset of your life, you've to be clear about certain features of the home that you are buying. Your list of requirements should include some basic desires such as the size of the rooms, your neighborhood, a distance of your office or groceries from your home etc. You should even check certain smaller details such as the layout of the bathroom, kitchen appliances and many more.

3. Mortgage that you qualify

Before you search for a suitable home, make sure that how much mortgage your lender will allow you to take out to purchase a home. Suppose you may think that you can afford to take out $500,000 as a home loan, but your lender will agree to pay you only $400,000. This happens because there are several factors which a lender will consider before approving your loan such as, your existing debts, your monthly income, your job status, credit score so on.

4. Homeowners insurance Payments

Homeowners’ insurance covers a broad protection to the insured and his family, including the spouse, children and any other person under the age 21 against hazards like fire and other perils and personal liability exposure. You need to have this insurance for your home. In order to get the best policy, you’ll have to decide on the costs and discounts.

5. Private mortgage insurance payments

If you don’t have big savings, and you were not paid at least 20% of the total borrowing, then you need to pay PMI to own a home. PMI is a must because, a potential lender needs to be ensured about the borrower’s default. Thus, the PMI will cost you big every month to own a house.

6. Property taxes

You should pay the property taxes as you are an owner of a house. You need to pay the taxes on the total value of your property. So, owning a house can add more 100 of dollars every month.

Some more area of expenses

  • Utilities
  • Appliances
  • Furniture
  • Renovation
  • Pest control
  • Maintenance
  • Yard care

Final words

Owning a house is costly, but your cost will vary. Mostly, it’ll depend on the lifestyle and the home features you’ve planned. So, if you can manage all the cost properly, then you can fulfill your dream. For instance, set aside some money beforehand. Thus, you may require to bear the expenses to maintain your home. Try to follow these guidelines to boost your confidence so that, you are able to buy the desired home.

Check out the mistakes you should avoid as a first-time homebuyer

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