Becoming a home owner is one of the most important financial decisions I have ever made. I purchased my first home at the age of 22 and later went on to purchase additional property. As a homeowner, I have learned so many lessons. In the following I will share the five most important lessons I have learned as a homeowner.
Know the Lingo
The most critical yet confusing part of purchasing a home is the financial aspect. In communicating with the mortgage broker , real estate agent, and attorney the lingo can be intimidating. Terminology such as points, primary mortgage insurance (PMI), and escrow all seem foreign to the average layperson; yet, each of them affects the amount of money the purchaser has to pay over the life of the mortgage. Therefore, it is very important for new homeowners to learn the financial vocabulary and there meanings. During the purchasing process, I had a great mortgage broker, who educated me on the ins and outs of the money matters involved with buying a home.
Home Maintenance is Key
When the economy plummeted in 2008, everyone was affected, included my family and I. The issues at hand were very clear, either use the emergency savings for maintaining our basic needs (mortgage, food, clothing, and utilities) or use the emergency savings to take care of maintaining the home (lawn care, landscaping, and exterior caulking). The house took the backburner, as my family and I took care of our basic needs. However, in the long run this decision cost more than $2000 in lawn repairs, as the lawn suffered from neglect. This leads me to the next point.
Money is Vital to Home Maintenance
It is important to have money saved for a home repair rainy day. As a homeowner, rainy days are unpredictable. Therefore, it is important to have savings set aside for emergencies that may occur. An example, my air conditioner failed this summer in Florida. Imagine how hot it was, the thermostat read 94 degrees, did I mention, in Florida. As the homeowner I was faced with an unexpected $400 expense. Thankfully, I had money set aside for home repair rainy days.
Homeownership as a Tax Benefit
When I file my taxes, I include the appropriate financial information regarding my property expenses. This is important as homeowners qualify for special tax deductions related to the home, which can save tax dollars. For more information on the personal property tax visit irs.gov .
Enjoy Living in the Home
The final lesson is the icing on the cake. It is written in light of recently experiencing a flood which left my family and I without a home. This displacement have reinforced my perspective of: I worked hard for my home, I will live in it, and I will love it because the future is unknown.