As you start to search for a home that matches your criteria, you will need to consider some of the home's initial costs as well as ongoing expenses. While you talk these options over with your real estate agent to find a home that fits your needs, be sure you plan for the homeownership and buying costs. Here are some recommendations to help you with your home purchase.
Recognize the Need the Buy
When you choose to buy a home instead of continuing to rent, there are several lifestyle changes you will need to be prepared for. Homeownership has many benefits, such as tax breaks, stability in your residence, being able to update and improve your home, and watching your home's equity value go up over time, but plan on some important responsibilities.
First, you will need to save up some money for your purchase, for initial expenses, and also plan for long-term costs. You will need to pay a down payment and pay for the home's closing costs, which can be several thousand dollars. Then, look to pay for homeowners insurance and property tax over the time you own the home. If any issues arise in the home's condition and you need to repair or replace components in the home, keep in mind that you will be the one to pay for these costs. You will also need to pay for the home's utilities, and plan for items, such as a new roof, or replacing the water heater. So, it is a good idea to keep a savings account to cover homeownership repairs and maintenance so you are prepared for the expenses.
If you are looking to buy a single-family home, look at the responsibilities you will take on, such as a yard and clearing snow and ice off the pavement. So if you want to own a home but don't want to do yard work or cleaning during winter or raking leaves, look at a townhome or a condo where the homeowners association handles the exterior work and upkeep.
Put Together a Down Payment
Once you have a good idea about the homeownership costs, talk to your realtor about applying for a mortgage with a broker. Your mortgage and the type of loan will usually require a down payment, depending on the type of loan. However, talk with your mortgage broker and your realtor about your options for a loan program that fits your budget and how much you can put toward a down payment.
If you have more questions, contact your real estate agent.