Buying a home is the single largest financial decision you will ever make. Owning a home is more cost effective then renting a home over the long run.

Before you jump into making a decision on buying a home, here are the short term financial outlays that you have to consider.

1. Down Payment – In today’s market your down payment will be between 5-20%. Most banks are looking for 20% to get your loan approved without having to jump through hoops.

2. Property Taxes – Property Taxes vary by state. Most states are between 1-1.35% of the purchase price of your home, which is paid on an annual basis.

3. Closing Costs – There are various fees that will be on your closing statement. From lenders charges, title insurance, escrow fees, prorated interest and other fees. Closing Costs usually run from 1-5% of the purchase price of your home.

4. Homeowners Insurance – This cost will vary based on contents and location of home.
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5. Moving Costs – This cost will vary based on the amount that you are moving and the distance that you are going from your current location to your new home.

This does not include the normal upkeep that you will incur on a monthly basis to your new home. Make sure you plan out your budget to cover these costs and make sure you can afford this on a monthly basis.