Buying a home is a big financial commitment but one that’s proven to be a great investment over time. You build equity, lock in your housing costs, own a real asset, take tax deductions, and can customize it to fit your wants and needs. There’s a lot of preparation, including going through your credit reports, and shopping various types of home loans to get the best one. While you’ll most certainly plan for a number of upfront expenses, there are other first time home buyer unexpected costs to know about.
Common First Time Homebuyer Expenses
The most commonly known home buyer expenses are the down payment, home inspection, wind mitigation inspection, pest inspection, earnest money deposit, and moving expenses. These will definitely add up and do so quickly. So, it’s smart to start planning early and preparing your finances for a mortgage application. Do yourself a favor and obtain copies of your credit reports from all three bureaus (you’ll likely find a number of errors that can cost you big time).
If you’re considering becoming a homeowner, even years from now, recognize that there’s a lot more to purchasing a house than saving enough money for a down payment. Additional expenses come up throughout the home-buying process. Some of these are upfront, out-of-pocket costs that are non-refundable even if you end up not closing the deal. Others will hit your wallet after the home is in your possession. Experienced buyers probably are familiar with these charges, but first-time buyers can be caught off-guard. —Kiplinger.com
If you do need to file disputes, do so through regular mail because the online forms are too short and do not support the ability to provide enough proof. When you’re ready, it’s time to begin to shop mortgages. Speak with an experienced mortgage broker to compare different loan products. Be sure not to withdraw a lot of cash prior to closing because this will be checked to ensure you have enough to pay for closing costs.
First Time Home Buyer Unexpected Expenses
Before you move in, you’re probably already scanning websites trying to find the best time to buy new home furniture. But that’s should go on a wish list because you’ll incur other costs you don’t plan for. Some of these will be inexpensive, while others will be more substantial. It’s great to know so you are taken completely by surprise. Here are the most common first time home buyer unexpected expenses you need to plan for:
- New door front and back locks. Expect to pay between $100 and $200 per lock set. This is something you shouldn’t necessary splurge on but you should stay away from the rock-bottom priced models. Also, go with tradition key locks because the high-tech will be very costly to repair or replace, if necessary.
- Window treatments or coverings. Something that surprises first time home buyers is the sellers taking the window treatments or window coverings with them. It’s common and you’ll certainly want your privacy. (Not to mention, keeping the sun out when it first beams through the windows.)
- Replacement kitchen appliances. Your purchase contract will stipulate if the appliances are sold along with the home or if the seller will take them. However, this doesn’t mean the seller won’t “forget” and take the appliances out of the home. Although it might be in the contract the appliances are to remain, don’t count on it happening.
- Lawnmower and other equipment. If you purchase a single family home, you’ll be taking on the lawn care work. Unless you plan to hire a lawn service, you’ll need a mower and other lawn equipment to maintain your yard.
- Fire extinguisher and smoke alarms. Usually, sellers do not take fire extinguishers with them. But even if these are left behind, you should have them inspected by the nearest fire station. Also, test the smoke alarms to know if they work properly.
If you’d like to know more about the various expenses that come with buying a home, and how to find the right property for you, please phone me at 407-616-7286, I’ll be happy to speak with you.