All Home Ownership Costs Although the cost of your mortgage is the largest part of your monthly housing expense it is not the only one.
The additional housing expenses include hazard insurance, home ownership association dues, property taxes, and mortgage insurance.
Your hazard insurance is the policy that covers damage to your property.
As long as you have a mortgage the lender will usually want you to have a hazard insurance policy to protect their collateral. If your home is damaged or destroyed the hazard insurance policy should be able to help them get their money back on their loan.
The home ownership association dues are something that some borrowers who live in condominiums or managed communities must pay. These are the costs of maintaining common areas, upkeep of the area such as mowing lawns, etc.
Although your property taxes are usually not due monthly many borrowers opt to include this in their monthly payment to their lender as part of an impound account. You need to figure out what your property tax burden will be when you buy a property. In some states the property tax may not increase but in many areas you run the risk of property taxes increasing over time.
Mortgage insurance is a charge some lenders imposes on higher risk loan that is usually more than 80% of the value of a property. This is a charge that they add to the monthly mortgage bill.
It is important to know what your total monthly housing expense will be before you buy your property.
You can use an online mortgage calculator to figure what your monthly mortgage payment will be. Many of these mortgage calculators will allow you to calculate your entitlement monthly income.