What happens after you buy your home? You get to move in all of your stuff and turn that house into a home. It’s all sunshine and rainbows….right?
Not so fast.
Mortgages aren’t a set-it-and-forget-it deal. You’ll have to stay on top of any year-to-year escrow changes. You might want to refinance someday – if interest rates improve. It is also likely that your mortgage will be sold to a third party.
Don’t be alarmed if this happens. Most lenders sell portfolios of loans on a regular basis. While this third party will own the actual mortgage loan, direct lenders will still service your loan. The new lender will also be the one to contact, should any issues arise.
When your first mortgage statement arrives, review it carefully. Make sure everything is accurate. Double check the address, as you may be sending payments to a new location. Verify your new point of contact, so you can deal directly with the loan servicer should any questions or concerns arise.
If you happen to notice an increase in your monthly payment, do not panic. It is more than likely due to a shortage in your escrow account. This increase is most often due to an increase in personal property taxes or home owners insurance.
You should also make sure you have included home maintenance in your budget. It’s important to keep your home in good repair. That way, you will get your money out of it should you outgrow the space or need to move. Do not immediately remodel everything that is dated. However, stay on top of issues with your foundation or roof (as those could be costly).
If you do decide to update your home, do it with resale value in mind. For example, if the homes in your area have out-of-date paneling on the walls, you could boost your value by removing it. Just be careful not to go overboard with improvement projects. Leave enough money for emergency repairs.
If you’ve bought in a neighborhood with a homeowners association, be sure to keep your home’s exterior looking good to avoid any penalty fees – and to stay in your neighbors’ good graces.
Keeping your house in good condition makes financial sense, and it will also make you feel prideful of your new investment.
Check out all of our posts in our home buying and selling series!
The blog and its opinions are expressly that of its author and does not convey the opinions or strategies of the Credit Union and should not be considered financial advice. CommunityAmerica’s Mortgage offers are subject to credit approval and terms may vary based on conditions.