What many consumers do not realize is when you are ready to put your property on the market or when you start looking for a home to purchase, there may be some hidden home expenses that can catch both home buyers and homeowners off guard. If you know the potential fees upfront, you can more easily budget for them, or at the very least be prepared to tackle them when the time comes.
When there is land involved, especially many acres, property survey costs often come into play. The lender may want a professional survey done so that the boundaries of the property lines are clear.
These professional surveys are another few hundred bucks out of your pocket. However, it is money well spent and can keep you out of hot water if an encroachment or setback issue arises.
Most people know that they are going to be required to pay taxes on their new home. However, many locations require taxes to be prepaid for the first year at closing. In some instances you can elect to pay it yourself at the end of the year. Most often, property taxes are included in your monthly mortgage payment. The taxes are based on the assessed value of the property plus any additional state or local taxes that are applicable. Property tax cover the entire year and is paid whether you own your home outright or have a mortgage.
Just as businesses need business insurance, homeowners need homeowners insurance. While most homeowners know that they will need this coverage, what they do not expect is the massive amount that some companies want down. If you put less than 20 percent down on your new home, your lender may require you to also have mortgage insurance. While there are a few companies that will do a month to month plan, many want quarterly, semi-annually, or annual policies. Having the taxes and insurance in the mortgage payment is wise, but for those who pay it separately, get ready to shell out some money.
Now that the loan is all settled, moving costs are another considerable expense. It is very costly to move these days. Renting a moving truck will set a person back a few hundred dollars, not to mention all the utility deposits and various other expenses. If a moving company is needed, the cost can be a few thousand dollars. It is better to set back money for moving costs so that there is no shock in the end.
So with all of this in mind, be prepared to save some extra money to make your purchase without any supplementary worries!!