When buying a home, affordability is paramount, therefore a number of expenses should be considered to determine "carrying costs". To determine approximate carrying costs consider the following ; Add to the MONTHLY MORTGAGE PAYMENT, the following,:

• 1/12th of the annual TAXES * (see below)
• 1/12th of the annual HOMEOWNERS INSURANCE
• 1/12th of the annual HEATING COSTS
• 1/12th of the annual MAINTENANCE ** (see below)
  
  These items added together equal what most people consider "rent".
  Telephone, electricity etc., are variables that are usually not included in rent, (although they must be considered ) and are not normally looked at as "carrying costs". When buying a multi-family home the rental income can be deducted from the above, lowering the carrying cost. ***(see below)
  
  
  Another important consideration is income tax deductions. The annual Real Estate Taxes and the Interest paid on your mortgage are usually City, State and, Federally Tax deductible. When they are, you can deduct 1/12th of the annual savings from your monthly carrying costs.
  
  
  1.Aside from the downpayment, you will need what is commomly called "closing costs". These costs might include; mortage points, attorneys fees, a title search, taxes,ect. Closing fees can amount to 4% to 7% (or more).
  
  2.The amount of downpayment will vary, depending on many factors i.e.; the economy, your occupation,your salary,ect. It can range from 10% to 30%.
  
  3.To avoid disappointment you should get seek professional advice and "pre-approval" will help in the buying process.
  
  Pre approval can be obtained from some of the Financial Institutions listed on our Related Services page. To contact a financial institution, an attorney, or any other related service in your chosen area click here
  
  
  There might be other special or local expenses that would be added , but the above should help in determining the affordability of the home of your choice.
  
  
  
  
  
  * Annual Taxes include all taxes such as Real Estate Taxes, water and sewer fees, school taxes, garbage pick-up etc.
  
  
  ** Annual maintenance is sometimes estimated as 1% of the purchase price but this will vary with the age and condition of the home.
  
  
  *** The rental income is added to your gross income in determining the amount of mortgage you can afford.
  
  
  

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