8 Things First-Time Homeowners Wish They'd Known
Closing day feels like the finish line, but anyone who has owned a home for a while will tell you it's really the starting point. These are the lessons new homeowners most often say they learned the hard way.
1Your monthly payment may not stay the same
Many first-time buyers assume the mortgage payment they sign up for at closing is locked in for good. Even with a fixed-rate loan, the total amount you pay each month often includes property taxes and homeowners insurance, and those can change.
If your lender collects taxes and insurance through an escrow account, it reviews that account periodically. When local tax assessments rise or your insurance premium goes up, the lender may raise your monthly payment to cover the difference, and sometimes ask you to make up a shortfall as well. Homeowners are often caught off guard by this the first time it happens.
Read every escrow statement your lender sends rather than tossing it aside. Keep an eye on notices from your local tax office, and shop your homeowners insurance when it renews to make sure the price still makes sense. Building a little extra room into your budget for these changes can make an increase much easier to absorb. If anything on a statement is unclear, call your loan servicer and ask.