Updated: Jan 27
First Time Home Buyer? Plan for These Hidden Costs
If you’re a first-time home buyer, it’s important to have your finances in order as you transition into your new house! There are hidden costs behind the scenes that can alter your budget if you’re not aware of them. Here’s a quick guide to the line items you should be considering so you’re not shocked by any surprising bills.
Your house isn’t going to be perfect after you buy it, and there are always improvements that can be made. New bathroom? Remodeled kitchen? A leak in the roof? These are all costs you’ll be responsible for. Home maintenance can cost money depending on what area of the house you are looking to upgrade. Keep in mind that you’ll like need to pay two to five percent of your home’s value in upkeep.
After you close on your mortgage, you’ll be responsible for several different bills including lender application fees, legal fees, mortgage taxes, title insurance, and recording fees in addition to real estate tax reimbursements if the seller already paid them prior to the sale.
If you’re applying for a mortgage, you’ll also have to get homeowners insurance. For example, homeowners insurance would cover the costs of items lost or damages if your home were to catch on fire. Insurance rates can vary based on the size of your home.
Just because the house is yours now doesn’t mean that utility costs will drop any lower. You’ll be responsible for paying for heat, gas, electric, water, cable and more. Make sure you’re on top of your budget when it comes to utilities – they can spike if you’re not careful!
The process of buying a home for the first time can be equal parts exciting AND stressful. These tips, however, can help ease any financial burdens due to unexpected costs. Are you in the market to buy your first home? Give me a call! If you come up with any financial challenges during your transition to a new home, I can help make sure you are prepared. I’m here to help!