For most of us, the asset value of one’s home represents our largest financial asset, so doesn’t it make sense to be as prepared as possible for the most common expenses associated with home ownership? Although this activity is often considered an essential part of the so-called American Dream, unless an owner is as prepared as possible, it could turn into a nightmare! The more one knows and recognizes what to prepare for, the easier and less stressful this happy act becomes. With that in mind, this article will briefly attempt to consider, examine, review, and discuss 6 of the basic expenses related to home ownership.
1. Down payment and closing costs: Although most people know and understand what their down payment will be, because their lender informs them, many do not fully consider many of the other associated closing costs. These include: title insurance and title search; real estate property taxes and utility charges; reimbursement for previous owners, prepayments of various items; legal costs; filing fees; etc.
2. Recurring monthly expenses: Many expenses associated with owning a home are recurring! Everything related to one’s mortgage should be considered, including paying principal, interest, and escrow charges. It is also important to understand that some of the items in escrow, such as real estate taxes, often increase annually.
3. Immediate cosmetic updates: Even when buying a house, which is considered to be moveable, the new owner generally has somewhat different tastes and needs / priorities and therefore will generally want to make sure it is immediate. , cosmetic changes / enhancements such as paint, floor related changes, etc.
Four. Routine repairs: Be prepared for routine repairs like repairs / fixes, minor appliances, doors and locks, and all those things that everyone who ever owned a home eventually realizes must wait, anticipate, and get ready for!
5. Major repairs: One must create a reserve fund, to be prepared, for major repairs, which are necessary, from time to time. These include: heating and cooling / ventilation / HVAC systems; large appliances (such as washer, dryer, refrigerator, oven / range, dishwasher, etc.); structural work (such as roof, gutters, windows, walkways, driveway, etc.), etc.
6. Renewals: No matter how excited one is, with the house, the purchases, the priorities, the needs, etc., the change, the time and the renovations can be indicated and necessary. Sometimes it may be related to the kitchen or an upgrade to a bathroom, while at other times one may decide to expand (add) the existing home, because, a homeowner, feels they need more and / or, different space, etc.
The more prepared you are, the happier you will be the homeowner, the experience! Proceed wisely and in a prepared manner!