There are two types of costs in buying a home — the initial amount you will need for your purchase and the ongoing costs of paying back your mortgage along with monthly operating costs. The largest one-time cost is the down payment. It usually represents 5-10% of the total price of the property.

Typical One-time Expenses

  • Loan fees (points, application fee, credit report and appraisal fee)
  • Prepaid interest
  • Property inspection (optional), due at time of inspection
  • Legal fees, due at the time of closing
  • Mortgage interest adjustment (if applicable), due at the time of closing
  • Title insurance
  • Documentary stamps on note.
  • Home and property insurance, at closing and ongoing
  • Home warranty (optional)
  • Moving expenses

Typical Monthly Expenses:

• Mortgage payments
• Maintenance (this could be condominium fees, or allocated maintenance fees)
• Property and content insurance
• Property taxes
• Utilities

Collect the following to prepare your plan:

  • Monthly rent or mortgage payments
  • Utility payments (gas, water, power, telephone)
  • All other monthly expenses (such as food, child care, dues, etc.).
  • Annual or semi-annual expenses (such as insurance, car repair, taxes).
  • Non-fixed expenses (for example, medical expenditures) for the last year. This will give you an estimate of average expenses of this type.
  • Records or an estimate of personal expenses. (entertainment, travel, etc.)
  • Credit card statements
  • Allow for unexpected items such as medical emergencies, travel and education.

Subtract expenses from income

Could remaining funds be directed towards a mortgage, debts or additional savings? How will a home purchase fit into your budget? Also consider items like insurance, taxes, repairs and maintenance.