Like any big project, a successful home buying experience is all about getting the details right
from start to finish. What is one of the most important details? Knowing what your costs will
be. Here are the main costs to consider when saving for a home.
DOWN PAYMENT
Your down payment requirement will depend on the type of mortgage you choose and the
lender. Some conventional loans aimed at first-time home buyers with excellent credit allow
as little as 3% down. Even a small down payment can be challenging to save. For example, a
3% down payment on a $300,000 home is $9,000. Use a down payment calculator to decide
a goal, and then set up automatic transfers from checking to savings to get started.
Remember, the larger your down payment, the lower your monthly mortgage.
CLOSING COSTS
These are the fees and expenses you pay to finalize your mortgage. They typically range from
2% to 5% of the loan amount. You can ask the seller to pay a portion of your closing costs. You
can save on some expenses, such as home inspections, by shopping around.
MOVE-IN EXPENSES
These are the fees and expenses you pay to finalize your mortgage. They typically range from
2% to 5% of the loan amount. You can ask the seller to pay a portion of your closing costs. You
can save on some expenses, such as home inspections, by shopping around.
You’ll likely need some cash after the home purchase. Budget for moving expenses and set
some money aside for immediate home repairs, upgrades, furniture and new decor. These are
the little things that really add up and can throw your new budget off. Make sure you sit down
and put pencil to paper and really plan what you can and cannot afford. Remember, your house
doesn’t have to be perfect the moment you move in. Take your time buying the furnishings you
like and fit your new home. You don’t have to get everything all at once.
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