Valdosta Daily Times

Business

April 14, 2013

Home is where the majority of your income is going

(Continued)

VALDOSTA —

 2. Get your debt in check. Just because you can qualify for a home loan doesn’t mean you can afford a home. Add up all your monthly bills including student loan and credit card debt. See how much you have left over and be sure that there is wiggle room so if your fridge breaks or you suddenly had a $700 water bill because of a leaky pipe (yes, both of these happened to my brother in just one month) then you will be able to afford to fix it. While getting out of rentals and owning your own home sounds nice, it’s a big responsibility and you can no longer call on your property management to fix stuff.

3. Really know the cost of a home. It’s not as easy as a home costing $200,000 and then you get a loan for $200,000 and pay for it. It’s also not just a mortgage payment you’ll have to make every month. There are several other things you will have to factor in:

- Closing costs: Though the housing market is on the rise, it is still a buyer’s market. So in these economic times, buyers can typically get the seller to cover the cost of closing. However, that is not always the case. Closing costs include points, application fees, credit check, attorney’s fee, lender’s attorney fee, title search, title insurance, appraisal fees, inspections, local fees, and document preparation.

• Escrow: This is an allotment you will pay to the lender every month in order to guarantee availability of funds for taxes and home insurance.

• Additional Home Insurance: In Georgia, while not having flood insurance is stupid, it’s not required. It’s an additional policy you can take out through the federal government and the federal government is the only place you can get it.

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