Mortgage Financing

Hidden Costs of Homeownership

When you’re buying your first home, you should be aware of additional expenses besides just your loan and interest payment. If you aren’t aware of these items, you may be shocked by the actual costs of homeownership. Here are a few expenses to expect


When you make your mortgage payment each month, it includes an escrow payment in addition to paying back your loan with interest. Escrow pays for two things:

  • Your city and state charge property tax to help pay for schools, emergency services and other fees. This tax is based on the value of your home and often increases over time. If you disagree with the amount collected, you can have a property tax challenge appraisal Dallas TXcompleted to determine the appropriate tax value of your home.
  • Homeowners insurance is also collected with your escrow because most mortgage lenders require this to protect their investment. Insurance is always good to have because it covers the cost of repair to your home in the event of damage caused by weather, natural disasters or theft.

HOA Dues

If you live in a neighborhood with a Homeowners Association, you need to pay dues. These fees cover maintenance to the common areas, pool maintenance and repair, gym equipment and social gatherings. Each association determines its prices independently and may collect monthly, quarterly or annually.


Once you move into your home, there are certain items that you need to be prepared to maintain. Your lawn and yard require weekly mowing and weeding, along with watering and trimming. Be ready to have different parts of your home inspected and cared for each year. A professional should examine your roof and HVAC system to prevent any minor problems from becoming major issues. Over time you also need to repair fences, replace appliances and paint the outside of your home. These expenses add up quickly if you don’t plan accordingly.