Now that you have selected a home within your purchase price, hopefully you have done some homework on the additional out of pocket expenses that you have to come up with besides securing a mortgage loan.
- 10% to 20% for down payment. It is generally the preferred range for a down payment that lenders would like to see as your skin in the game of owning your home.
- A significant portion of the mortgage repayment is the loan interest. Using an amortization schedule allows you to see how much cumulative interest you will pay until the end of the loan.
- Real estate property taxes can be expensive depending on whether the area has good schools.
- Home maintenance and repair costs through out owning your home. (Account for infrequent special assessments when joining a condo / co-op / homeowners association.)
Other costs to include:
- Home inspections prior to finalizing the sales contract.
- Appraisal fee. Lender requires appraisal of home before issuing mortgage.
- Origination fees of the mortgage loan.
- Moving cost depends on if hiring movers or getting friends to help you.
- Utility and service setup cost. Electricity, cable service, and home security system setup.
- Remodeling cost if you need to finish a basement or redo a bathroom.
Refer to closing cost section for detailed break down of closing cost expenses.