So, You Are Buying a House
Common Expenses to Plan For
In the excitement of buying a home many new home buyers do not anticipate many of the other expenses that are involved in buying a home and some Realtors forget or just flat out do not prepare their buyers for some of the other expenses involved in purchasing a new home and if it has been a while since you bought a home some things may have changed. So, it's a good thing to always be prepared when the time comes and not be short.
This is a major expense in purchasing a home and it is due at closing. In Maryland closing coasts in include document stamps, transfer taxes, title insurance and settlement and loan company fees. It is usually a percentage of the purchase price. A good Realtor will often ask the seller for closing cost assistance, depending on your loan type that can be up to 6% and that seller help can off set a lot if not all of these fees.
Unless you are moving from home or have little to no furnishings and personal belongings this could be a major expense too, be sure to shop around and call several moving companies. You could also just rent a UHaul and ask your friends and family to help you move. Moving companies will send someone out to your house and they will take a look at what you have then give you an estimate and several options which could have them packing up your stuff or you packing up yourself. Don't skimp on moving companies, be sure to use a reputable company with decent online reviews.
Be sure to ask your lender, title company and Realtor if your property taxes are escrowed or not. Don't get into your home and 4 to 6 months later have a property tax bill arrive in the mail.
Your lender may insist that an escrow account be set up at closing to pay for your property taxes and home owners insurance. This will usually be included in your monthly mortgage payment.
Unless you are buying a condo, you will have gas and electric and water bills to pay. Not all homes have natural gas service but all will have electric and water service charges. You can shop for your electric provider but water usually comes from your municipality. Your home may also be heated with oil, which is delivered to your home by a local service provider, you won't want to be caught in the middle of winter with no heat.
You may want to start fresh in your new home with new furnishings. Also, your existing furnishings may not be enough to furnish your new home so you'll want to budget for new furnishings, cleaning supplies, linens, paint supplies to decorate with and things like that.
If you are buying a house or a townhouse you will also have grass, flower beds and exterior maintenance things to take care of. If you aren't handy with things like that, you'll need a lawn mower, hedge trimmers, weed eater, grass fertilizer, lawn food, lawn seed and things of that nature.
A good Realtor will ask for a Home Warranty in your contract. This will help you budget for inevitabilities like appliance breakdowns and plumming and electric issues. You are now a home owner so you are responsible for these things. A good Home Warranty will give you one phone call about $100 deductible and your item is repaired. Otherwise, you will want to set aside a little money every month just in case your furnace stops working or your drains get clogged.