The first step toward finding the right home is to quickly compute your purchasing power and determine how much you can afford to pay each month. This saves you time by allowing you to focus on homes in your price range.
Some up front costs include:
Down payment: Typically ranges from 3-30% of the cost of the house. The more you can put down, the greater equity you will have in your home and the lower your monthly payment will be. For down payments less than 20% you may also need to pay mortgage insurance.
Closing Costs: Typically range from 2-6% of the loan amount depending on your area.
On-going Costs: Your housing costs can include the following:
- Monthly mortgage payment
- Homeowners insurance
- Mortgage Insurance
- If applicable – Flood Insurance
- If applicable – Property taxes