Our team is always here to help you get the mortgage you need, and we can discuss the fees and other costs related to your home purchase and how to plan for them.
If you’re a first-time home buyer in St. Louis, you probably know that you’ll have a mortgage payment every month. But there are other additional costs you may need to pay on top of your monthly mortgage, too.
It’s important to keep these in mind when shopping for a home and getting a mortgage from Sean Zalmanoff: Better Rate Mortgage. So let’s discuss some of these costs now so that you can budget accordingly.
The property taxes you’ll pay depend on the value of your home, as well as your community in St. Louis, abatements, and a few other factors. You can use this online tool from the City of St. Louis to see how much you may need to pay.
Property taxes are usually paid twice a year but maybe rolled into your mortgage. If this is the case, you will pay toward your property taxes every month. Then the bank will pay your property taxes for you every six months.
Homeowners insurance protects your home from theft, fire, natural disasters, and other such things. Again, this may be included in your monthly mortgage payment along with your property taxes – make sure to consult with your lender to make sure this is the case.
The cost varies depending on your home’s location, size, age, and many other factors, but you will usually pay about $35 per month for each $100K of home value.
Private Mortgage Insurance (PMI)
Private Mortgage Insurance (PMI) is required if you put less than 20% down on your home. So if you get an FHA loan, for example, with a 3.5% down payment, you will have to pay PMI.
PMI protects your lender and reduces their risk if you stop paying your mortgage. Usually, it’s priced at between 0.5% and 1% of your loan amount per year. So if your mortgage is for $150,000, you’ll owe $750-$1,500 in PMI.
Again, this is usually rolled into your monthly mortgage payment, if applicable, but this is not always the case.
HOA (Homeowners Association) Fees
If your neighborhood has an HOA (Homeowners Association), you may need to pay monthly fees directly to the HOA. Failure to do so could result in civil penalties or even foreclosure.
These fees may pay for maintaining common areas and amenities like tennis courts, swimming pools, shared parks or green space, and other such costs. Usually, HOA fees are between $100 and $300 a month in St. Louis, but many areas don’t have an HOA at all, so this depends on where your home is.
Need Help? Contact Sean Zalmanoff: Better Rate Mortgage Today!
At Better Rate Mortgage, our team is always here to help you get the mortgage you need, and we can discuss the fees and other costs related to your home purchase and how to plan for them. So don’t wait. If you need guidance and a great rate on your mortgage in St. Louis, contact us today to schedule an appointment.