You found your new home! After many open houses and home and garden shows, you have decided that this house is where you are going to lay your head every night. The price is in budget. All is set. But, did you factor in other costs?
Your monthly home payments is more than just your mortgage.
While your mortgage may be lower than what it would be to rent a home, you need to ask your realtor about start-up costs. You can also calculate them here.
Cash necessary.
When you buy a property, you may need to fork up between 3 to 20 percent down payment. Even the 3 percent that you get from the Federal Housing Administration is a large amount of money. If you are building a home or chose a fixer upper, there are some unknown costs that can delay moving in if you don’t have the money to keep it going.
Have reserve cash for emergencies. Do it for yourself as well in case of job loss, etc.
Your actual bills each month.
Time for some math. Hopefully, you paid attention in that Math class where they discussed compound interest. If not, here is a quick overview.
Monthly payments will consist of PITI (Principal, Interest, Taxes, and Insurance). This is determined by the purchase price of your home and the interest rate that you received for the home. In addition to that, add to your budget the money you’ll pay for utilities (gas and water), entertainment (cable, TV, internet), and other maintenance costs (garden and lawn care, etc).
In some places, you’ll need to include HOA fees.
Fixer Upper? Custom Build? Other?
Where will you save? Fixer Uppers may be cheaper to buy upfront, but maintaining it may become a bigger financial burden for you in the long run. A new home may be more expensive now, but with less things that you will need to fix.
Got questions? Put them on the Perry Homes Southern Utah page and get to know our community or set up a time to consult with our staff!
