![]() ![]() You may have to pay a prorated portion of property taxes or homeowners association fees.Īn experienced mortgage specialist can help you understand the true costs of homeownership so you can be a financially prepared buyer. A survey is required to show the legal boundaries of the property. It’s based on comparable home sales in your area, and your lender needs it to ensure the house is worth the amount you’re asking to borrow. An appraisal is an upfront fee that’s needed to establish the fair market value of the home. The insurance protects the lender if the borrower defaults on the mortgage. If your down payment is less than 20%, you may be required to purchase private mortgage insurance, or PMI. It may be rolled into your closing costs or it can be included in the loan. You’re typically required to purchase lender’s title insurance, which protects the lender in case there’s a problem with the home’s title. Your costs will depend on the value of your home and its location. This required expense protects you against personal liability and hazards, such as fire. It will list many of the fees that are required at closing, such as: When you apply for a mortgage, your lender must give you a document called a Loan Estimate. Others can be rolled into your mortgage, which will affect your monthly payment. ![]() You will have to pay some fees up front, such as if you choose to have a professional home inspection. ![]() The 36% would be your total financial obligations, including housing expenses and any other debt you may owe, such as outstanding credit card balances or loans.īe prepared for some extra expenses when you buy a home. While 43% is considered the maximum debt-to-income (DTI) ratio for a qualified mortgage, the 28/36 rule recommends capping your DTI at 36%. According to this rule, 28% of your gross monthly income should go to housing, which includes your housing payment of principle, interest, taxes, hazard and mortgage insurances and any homeowner’s association fees. ![]()
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