Unexpected costs first-time homebuyers should be aware of

Being a first-time homebuyer is an exciting time. But it can also be very stressful, especially when costs start to escalate. While first-time homebuyers typically know to prepare for a down payment, that is definitely not the only cost to consider when buying a home. Home-buying costs add up quickly with numbers that often startle first-time buyers.

Before signing on the dotted line, check out the list below and prepare yourself for all of the costs that go along with buying a home.

Earnest Money

When you make an offer on a home, you will be required to fill out a home application. Along with the application, you can opt to include a check for earnest money. Earnest money is like a deposit toward the home you want to buy. It is a good way of showing the seller that you are a committed and trustworthy buyer who truly wants to purchase their home. Here’s how it works.

If the contract goes through, the earnest money will be applied toward the down payment and closing costs. However, if the contract does not go through, there are many contingencies in place that will ensure you get your money back.

Note that backing out of your contract at the last minute simply because you changed your mind most likely won’t count as a legitimate excuse, so before putting down earnest money, be sure to carefully review any contracts before putting earnest money down.

Appraisals and Inspections

Appraisals and inspections are required when purchasing a house. Just know that both come at a cost. Here’s what each entails.

Appraisals ensure an accurate asking price, which provides you and your lending institution some protection. The buyer is generally responsible for the appraisal cost – often as much as several hundred dollars. However, keep in mind that you may be able to negotiate with the seller and split the cost.

Home inspections are another cost homebuyers are responsible for. Inspections are separate from the appraisal process and offer additional security for homebuyers. During a home inspection, everything is thoroughly checked – the foundation, electrical outlets, roof, pipes, toilets, etc. If an inspection results in any problems, it will affect your purchasing decision; it will also give you bargaining power. In some instances, you can ask the seller to address any concerns you have before the closing or negotiate a better asking price.

Insurance

Insurances comes in many forms, from health to dental and even auto. But did you know there is also home insurance? Homeowner’s and mortgage insurance are the two biggies you should know about.

Homeowner’s insurance is something every homeowner needs – and most lending institutions require you to purchase it and pay for a year’s worth of coverage before they will approve your loan. Why is it so valuable to have? Homeowner’s insurance will help pay for repairs, a rebuild, any damaged personal belongings, etc.

Mortgage insurance is a way for lenders to protect themselves in the event that the buyer doesn’t end up paying them back. Unless you put down 20% or more on a home, you will be required to purchase mortgage insurance. If you are required to purchase it, the cost will be included in your monthly mortgage payments.

Escrow Fees

When purchasing a house, an escrow officer – usually a lawyer or title company representative – will serve as an independent third party that ensures closing procedures go smoothly and that everyone you owe money to is paid accordingly. Unfortunately, escrow officers also require a fee for their services, so you will need to pay them as well. The good news here is that the escrow fee is typically split between buyers and sellers.

Utilities

If you’ve been renting a home until your first-home purchase, you have probably paid connection fees for services like electricity or gas. But when you own a home, you will be responsible for many more utilities – which will be pricier than you were previously used to. You will be responsible for paying set-up fees and monthly payments for all utilities, including electricity, gas, water, sewage, trash, recycling, and cable and internet. When you set up these services, utility companies will check your credit history and may even require you to pay a deposit to use their service.

Maintenance, Repairs and Other Home Improvements

If there’s one thing to remember as a first-time homebuyer, it is that nothing ever goes as smoothly as you’d like. A seller may cover major repairs, like sewage system leaks or issues with the foundation, but you may still come face to face with maintenance and repair costs after moving in. Some things may be important to fix right away, like the water heater, roof or HVAC system, while others may be done over time, like cosmetic upgrades to flooring and cabinetry.

For all things moving, ABC Movers can help. Click here for more.

66 thoughts on “Unexpected costs first-time homebuyers should be aware of”

  1. Greetings I am so happy I found your blog page, I really
    found you by accident, while I was browsing on Askjeeve for something else, Regardless I am here now and would just like to say thanks for
    a fantastic post and a all round enjoyable
    blog (I also love the theme/design), I don’t have time to look over
    it all at the minute but I have book-marked
    it and also included your RSS feeds, so when I have time I will be back to read more, Please do keep up the excellent jo.

  2. I am extremely impressed with your writing skills and also with the layout on your blog.
    Is this a paid theme or did you modify it yourself? Either
    way keep up the excellent quality writing, it’s
    rare to see a nice blog like this one nowadays.

  3. Hi this is kind of of off topic but I was wondering if blogs
    use WYSIWYG editors or if you have to manually code with HTML.

    I’m starting a blog soon but have no coding knowledge so I
    wanted to get guidance from someone with experience.
    Any help would be enormously appreciated!

  4. I feel this is one of the such a lot significant
    info for me. And i am happy studying your article.

    However wanna commentary on few common things,
    The website taste is ideal, the articles is in point of fact nice :
    D. Good task, cheers

  5. Hmm it appears like your site ate my first comment (it
    was super long) so I guess I’ll just sum it up what I had written and say, I’m
    thoroughly enjoying your blog. I as well am an aspiring blog blogger but I’m still new to
    the whole thing. Do you have any tips for newbie blog writers?
    I’d really appreciate it.

  6. It is the best time to make some plans for the future and it’s time to be happy.
    I have read this post and if I could I wish to suggest you some interesting things
    or tips. Maybe you could write next articles referring to
    this article. I desire to read even more things about it!

  7. 581881 18604Youre so cool! I dont suppose Ive read anything like this before. So nice to uncover somebody with some original thoughts on this subject. realy thank you for starting this up. this web site is something that is needed on the web, someone with a little originality. valuable job for bringing something new to the internet! 36323

  8. 83223 9515Youre so cool! I dont suppose Ive learn anything like this before. So good to locate any person with some authentic thoughts on this topic. realy thank you for starting this up. this website is something that is wanted on the internet, someone with a little bit originality. useful job for bringing something new to the web! 142582

  9. I used to be recommended this web site by means of my cousin. I’m not certain whether or not this put up is written via him as no one else recognise such designated approximately my difficulty.
    You are incredible! Thank you!

  10. Superb site you have here but I was curious if you
    knew of any community forums that cover the same topics talked about here?
    I’d really like to be a part of group where I can get opinions from
    other experienced individuals that share the same interest.
    If you have any recommendations, please let me know.
    Bless you!

  11. Its such as you read my mind! You appear to know a lot approximately this, such as you wrote the e book in it or
    something. I believe that you could do with a few p.c.
    to force the message home a little bit, however instead of that, that is fantastic blog.
    A great read. I will certainly be back.

  12. Very nice post. I simply stumbled upon your weblog and wanted to say that
    I have really loved browsing your weblog posts.
    In any case I will be subscribing in your feed and I’m hoping you write once more very soon!

  13. Right here is the perfect site for anyone who would like to
    find out about this topic. You understand so much its almost tough to argue with you (not that I really will need
    to…HaHa). You certainly put a fresh spin on a subject that has been written about for years.
    Excellent stuff, just great!

  14. It’s actually a nice and useful piece of info. I’m satisfied that you
    just shared this useful information with us. Please keep us up to date
    like this. Thank you for sharing.

  15. 674904 782754Hi there! Someone in my Myspace group shared this internet site with us so I came to give it a appear. Im surely loving the information. Im bookmarking and is going to be tweeting this to my followers! Outstanding weblog and great style and design. 959895

  16. Good day I am so delighted I found your blog page,
    I really found you by error, while I was searching on Aol for something else, Anyhow I am here
    now and would just like to say thanks for a remarkable post and
    a all round entertaining blog (I also love the theme/design), I don’t have time to go through
    it all at the moment but I have saved it and also added in your RSS
    feeds, so when I have time I will be back to read a lot more,
    Please do keep up the awesome work.

  17. We’re a group of volunteers and opening a new scheme in our
    community. Your web site provided us with valuable information to work on. You’ve done
    a formidable job and our entire community will be thankful to you.

  18. Hi there just wanted to give you a brief heads up and
    let you know a few of the images aren’t loading properly.
    I’m not sure why but I think its a linking issue. I’ve tried it in two different internet browsers and both show the same results.

  19. After going over a handful of the blog posts on your website, I seriously like your way of writing a
    blog. I saved as a favorite it to my bookmark website list and will be checking back in the near
    future. Please check out my web site too and tell me
    what you think.

  20. 443407 557385brilliantly insightful post. If only it was as simple to implement some of the solutions as it was to read and nod my head at each of your points 592460

  21. My developer is trying to convince me to move to
    .net from PHP. I have always disliked the idea because of the
    expenses. But he’s tryiong none the less. I’ve been using WordPress on numerous websites for about
    a year and am nervous about switching to another platform.
    I have heard great things about blogengine.net. Is there a way
    I can transfer all my wordpress posts into it? Any kind of help would be greatly appreciated!

  22. I like the valuable info you provide in your articles.
    I will bookmark your weblog and check again here frequently.
    I’m quite certain I will learn lots of new stuff right here!
    Good luck for the next!

  23. Right here is the perfect site for anyone who would like to understand
    this topic. You know a whole lot its almost hard to argue with
    you (not that I really would want to…HaHa). You definitely put a fresh spin on a topic which has been written about for
    many years. Great stuff, just wonderful!

  24. Hi there! This post could not be written any better!
    Reading through this post reminds me of my previous room
    mate! He always kept talking about this. I will forward this write-up
    to him. Fairly certain he will have a good read. Many thanks for sharing!

  25. I simply could not go away your web site before suggesting that
    I actually enjoyed the standard info an individual
    supply for your guests? Is gonna be back steadily to check out new posts

  26. An outstanding share! I’ve just forwarded this onto a coworker who had been conducting a little homework on this.
    And he actually ordered me lunch simply because I found it
    for him… lol. So let me reword this…. Thanks for
    the meal!! But yeah, thanks for spending some time to discuss this issue
    here on your web site.

  27. Hello There. I found your blog using msn. This is an extremely
    well written article. I will make sure to bookmark it and return to read more of your useful information. Thanks for the post.
    I will certainly comeback.

  28. Hello just wanted to give you a quick heads up and let you know a few of the pictures aren’t loading properly.

    I’m not sure why but I think its a linking issue.
    I’ve tried it in two different internet browsers and
    both show the same results.

  29. What i don’t realize is actually how you’re now not really
    a lot more well-liked than you might be now. You are very intelligent.
    You realize therefore considerably relating to this subject,
    made me individually believe it from so many various angles.
    Its like women and men are not interested until it’s one thing to accomplish with Woman gaga!
    Your individual stuffs nice. At all times deal with
    it up!

  30. Excellent post. I used to be checking constantly this weblog and I am impressed!
    Extremely useful info particularly the remaining section :
    ) I take care of such info much. I used to be looking for this particular information for a very lengthy time.
    Thank you and best of luck.

  31. Wow, incredible blog layout! How lengthy have you ever been running a blog for?

    you made running a blog look easy. The entire glance of your web site is fantastic, as
    neatly as the content!

Leave a Reply

Your email address will not be published. Required fields are marked *