Costs That Come with Buying a New Home

July 18, 2019

Over the next couple of weeks, one of our preferred lenders, Citywide Mortgage, is going to give us a closer look at the process of financing your home. Today, we'll walk through the costs of buying a new home.
Here's a breakdown of the expenses you can expect: Down payment and earnest money, Your monthly mortgage payment, Closing costs, Other fees and expenses Let's take a closer look at what each of these means.
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Down Payment and Earnest Money Before you even buy the home, you'll need cash for your earnest money and down payment. You may have heard the myth that you need a 20% down payment to buy a home, but there are actually loan programs available that require as little as 3.5% — or even 0% down for those who qualify. Let's discuss your options when you're ready.
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The Mortgage Payment Your monthly mortgage payment consists of:
Principal: The actual amount you are borrowing.
Interest: What it costs to borrow the money for your home.
Escrow: A third party account used to pay for taxes and insurance on your behalf. Learn more about escrow.
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Closing Costs You'll also have to pay closing costs when ownership of the home is transferred to you. Closing costs are a one-time payment due when you close your loan. Everyone's closing costs vary slightly, but below are a few examples of what might be included: Icon 1 You can negotiate with the seller to pay some or all of your closing costs. If the seller won't pay and you can't afford these costs, let's talk about rolling them into your loan. Learn more about closing costs.
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Other Expenses to Save For Don't forget: Your home will need regular maintenance and upkeep. You'll also have bills for electricity, water, internet, and other utilities to pay. And don't forget your moving costs! Whether it's hiring professionals or handing out pizza and sodas to your buddies, you still need to save some cash!
 
If you have further questions about the costs that come with buying a home, Citywide Mortgage, is here to help.
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