Costs Associated With Buying Your Northern Kentucky Home.

Home ownership is still one of Americans top priorities. Here in Northern Kentucky that is the case too. Going from renting to owning your own home can seem like a tedious mission. But if you plan, the goal of home ownership can be yours. When budgeting how much home you can afford, it’s important to understand and anticipate the costs of owning a home. Here are a few things that should be on the list.

Inspections, appraisals, and closing costs. Most home buyers understand they will have closing costs but they fail to budget for other items such as a home inspection. Sometimes, like with a VA loan, inspections are paid for by the seller yet in most cases it’s usually the buyer who pays for the inspection. Lenders usually require an appraisal and have various charges that are associated with closing a loan.

Private Mortgage Insurance. This is added on to your mortgage when the down payment is less than 20 percent. You can buy a home with less money but you’ll pay the PMI which covers the lender should a home buyer default on the loan. Once you build up equity over 20%, your PMI should be removed.

Homeowner’s insurance. Lenders require homeowner’s insurance on your property. The amount you’ll pay depends on where you live, the age, type and size of your home. For example, older homes can cost more to insure due to the fact that they may require more repairs than newer homes. Also, high-hazard areas can cost more to insure and some insurance companies may not offer an insurance policy for your home, if you’re in a high-risk area.

Taxes.Property taxes generate revenue for municipalities, counties, and schools. It’s an expense that can vary across the country but here in Northern Kentucky it's around 1% annually.

HOA Fees. Homeowners Association fees (HOA) can add several hundred dollars to your monthly household expenses. These HOAs help to maintain common areas, typically within condominium complexes. They also govern what can be done to the unit and the surrounding area. While there is an up side to HOAs, some buyers prefer to have more freedom over their property, perhaps, until the neighbor paints his house turquoise with red accents.

Utilities and appliances. These areas can be overlooked because, often, when people are renting the appliances are taken care of. When you own your own home, be sure to consider expenses such as the water heater or dishwasher breaking down. While, you can’t exactly figure out when an appliance is going to quit working, you can set a monthly allowance aside to start establishing a household repair fund. Just don’t touch the account or when you really need it, you’ll find it’s not there for you.

While these extra expenses do add up, if you budget and plan ahead, the goal of home ownership is achievable and very satisfying for most.