SCHUTT LAW FIRM, P.A.
Phone: 239.540.7007
Blog
02/19/2018
Budgeting for a house can be confusing. How much should you save? What should you consider? Here are some tips to help you create a comfortable budget.

The first step in planning for a new home is knowing how much you have and how much you can afford. You’ll probably ask for a mortgage loan, which can take a long time to pay off. You need to be sure that your budget leaves some room to spend on things other than paying off your debt. After all, what kind of life is one where you can’t afford to go out for dinner from time to time? Here’s what you should consider in your budget and not give everything else up.

How to Budget For Your Housing Expenses

If you’re currently renting a home, you probably don’t consider most of the housing expenses that homeowners need to pay.  Your housing expenses should take about 30-35% of your monthly income. These will be your expenses. Mortgage: With a mortgage calculator you’ll be able to calculate what your mortgage payments might look like so you can start your budget. Keep in mind that mortgage doesn’t include the down payment. So when you buy a home, you’ll need to pay that with your own money. Also, mortgage comes with some fees that you should also learn about. You should read a bit about the common mistakes mortgage borrowers make so you can avoid them. Utilities: Many renters don’t consider the services because they come included with their rents. You should contact each utility provider to get an idea of what the rates are going for and prepare. Property taxes: Some mortgage lenders will offer to take care of your property taxes and include them in your mortgage payments. If you choose that option, you just need to raise your monthly payment and forget about your taxes. Property taxes depend mostly on where you live. Condo fees:  If you decide to buy a condo, you will need to consider the monthly condo fees in your budget. Sometimes these charges can set you back multiple hundreds of dollars. The bright side is that these fees might include a part of your utilities, so that’s one thing you can scale back on. Pay very close attention to condo fees before buying any property. Insurance:  There are several types of insurance you need to consider for your new property. As a renter, you should have renter’s insurance, so it shouldn’t come as a surprise that your home should need more protection. First, you will want to get home homeowner’s insurance to protect you against robbery and some natural disasters. Consider getting flood insurance as well. A home warranty would also be a good idea in case there’s a structural problem in your home. Don’t forget to get title insurance as well. Since you’re protecting the physical integrity of your home, you also want to take care of the property’s legal safety. Contact Schutt Law- Title Insurance Agency at (239) 540-7007 to learn about the title insurance process and how you can start it. The great thing about title insurance is that unlike other types of insurance, you only need to make a single payment. Life insurance: You will need life insurance if you’re buying the house with a partner or if you have dependents. If anything were to happen to you, who will be able to continue making the home payments? It’s not something you want to talk about in a casual conversation, but life insurance is a basic need.

 Consider Emergency Savings

There’s no possible way to tell if something in your home will break or not. A home inspection will let you know if there are any major repairs you should take care of before buying a house, but after getting the keys, all repairs are on you.  You should have some emergency savings on a budget in case there’s something that needs fixing or replacing. Maintenance and repairs are some of the costs people don't usually consider before becoming homeowners.

All Other Expenses to Consider

While no one is going to tell you how you should spend your own money or how you should be saving it each month, it would be a good idea to save some for your retirement. If you budget your house expenses correctly and keep them under 35% of your income, you’ll have around 65-70% left for your other expenses. You can save 10% of the money you’ve got left towards your retirement fund.

Get Your Title Insurance in Fort Myers

Safety and protection is something you should never skimp on when it comes to buying a home. You might not consider title insurance as a primary necessity, but it is something you can surely benefit from. There are many reasons why you should get title insurance for your home in Fort Myers. You can call Schutt Law- Title Insurance Agency at (239) 540-7007 to learn all about them.