Getting your ducks in a row when buying your first home

___

Believe it or not, many a homebuyer who may have saved up meticulously for years for the down payment on a house can end up flat-footed after the close of escrow. Why? Because often they have not thought about the expenses of homeownership that have nothing to do with their monthly mortgage payment.

PennyHoarder's Nicole Dow reminds readers about a brand spanking new set of expenses that present themselves after the fact — not just property taxes, but several other budget items to prepare for as well.

"Homeowners insurance generally protects against losses or damages to your home and belongings, plus liability coverage for accidents that may occur on your property," says Dow. She explains how the items covered by your homeowners' insurance policy will differ based on your policy, and that will determine the cost as well. For instance, a house with a pool or those located in flood plains or earthquake zones will cost more because of risk factors. Even if you aren't required to get flood or earthquake insurance, however, you may opt to do so to protect against damage your homeowner's insurance doesn't cover. It's your call.

If you prefer, you can set up an escrow account so that when you make your monthly house payment, you are paying a portion of your property taxes and homeowners' insurance as well, saving you the trouble of keeping a separate savings account for them.

Unfortunately, you can't roll the cost of your utilities into an escrow account, even if it was once part of your rent before you became a homeowner. To get an idea of what the monthly bills are for your various utilities (water, sewer, electricity, garbage) you can either call those companies and ask for a survey for your property or check online for customary charges for a property your size. Your Realtor might be able to get those numbers from the previous owners as well.

If you're buying a newly built home, maintenance and repairs are not a huge concern. For the first year, your builder may warranty your home. But for those buying a home "with experience," however, personal finance experts suggest homeowners save 1 to 2% of their home value each year for maintenance and repairs. Dow suggests keeping these rainy day funds in a high yield savings or money market account, but make sure you can easily access the funds when an emergency arises.

A home warranty often covers repairs to specific systems and appliances, like your HVAC system or your fridge. "Weigh the costs of the warranty (plus any related service fees) against how much you would save on your own for future repairs," says Dow.

If you are not one to wield a lawnmower and a pair of pruning shears, lawn care is another task you might plan to outsource. Are you hiring a lawn care company? Be sure to shop around for the best prices or talk to your neighbors for recommendations. Other sources are websites like Angie's List, HomeAdvisor or Nextdoor.

While not everyone sees the need for a security system, it's an expense to consider. As your home is your biggest asset, it may feel wise to protect both the dwelling and its belongings." When considering security systems, budget for the initial cost of buying and installing the system, plus the monthly cost for monitoring," says Dow. "At the bare minimum, when you move into a new house, you'll want to pay to get all the locks changed."

Of course, if you have other questions about owning a home, please reach out. We're always here to help!

Sources: PennyHoarder | TBWS


All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

Surefire Mortgage Group (dba Home Front Mortgage) is an equal housing lender. 

Surefire Mortgage Group operates mortgage companies under separate NMLS Numbers and licenses in different states. Please search the NMLS Number on Consumer Access for more information.

NMLS #'s: 1611328 | 2316461 | 2468709 | 1894173 | 2489117 | 2507996 | 2513177 | 2489113 | 2615968 

To view our NMLS Filings, CLICK HERE | To read our Important Disclosures, CLICK HERE

Brian Voytko

Certified Mortgage Advisor

NMLS: #437292

400 Arcola Rd., Collegeville PA 19462

Company NMLS: 1611328

Cell: 215-407-3832

Email: brian.voytko@homefrontloans.com

Web: http://www.mtgwhiz.com

Avatar

Brian Voytko

___

Certified Mortgage Advisor

NMLS: #437292

Cell: 215-407-3832


Last articles

___


Mortgage Calculator

___


Scroll top