Beware of These Hidden Costs of Homeownership
Knowing how much house you can afford is the first step in the home buying process. If you’re ready to start your journey toward homeownership, make sure you factor these hidden costs into your budget.
Whether you love or hate surprises, we can all agree that unexpected expenses are no fun. Avoid budget blunders and factor these hidden costs into your plan:
Depending on a community's location and amenities, Home Owners Association (HOA) fees can range from hundreds of dollars a year to hundreds of dollars a month. Before you make an offer on a home, make sure you're fully aware of whether or not the neighborhood has an HOA and, if so, how much the dues are monthly or annually.
Private Mortgage Insurance
Most lenders require private mortgage insurance (PMI) for homes financed with less than 20 percent down. This type of insurance protects the lender in the event that a borrower stops making payments on their mortgage. If necessary, ask your MIDFLORIDA mortgage specialist to help you estimate your monthly PMI payment for a house in your price range and make sure you can swing that additional monthly expense.
Upgrading from a one-bedroom apartment to a three-bedroom house not only gives you more room for activities, but it also means there's more square footage to heat and cool. When you find a house you're interested in buying, have your real estate agent request an electric and/or gas bill from the listing agent. Your AC preferences might differ from the current homeowner's, so this isn't a fool-proof way of estimating your own expenses, but it could give you a general idea.
We're here to help
If you need help figuring out how much house you can afford, find a local MIDFLORIDA mortgage specialist near you or request a consultation.