A house is a major investment. For many people, it’s the most expensive purchase they will ever make. And for those who forget to consider the assortment of additional expenses and costs of buying a home, this often turns out to be more pricey than they may expect.

The purchase price is the most obvious cost involved in buying a home. And while that figure may be the biggest part of this transaction, it is far from the only cost you will need to think about. There are a variety of fees and expenses beyond your monthly mortgage payment. These extra expenses can add up—and they may even be a determining factor in helping you decide whether to rent or buy a home.

6 costs involved with buying a home

1. Down payment
2. Closing costs
3. Inspections and appraisals
4. Taxes and insurance
5. Private mortgage insurance
6. Monthly maintenance, utilities and HOA fees

The down payment technically isn’t an additional fee, since it counts toward part of the purchase price. But it is one of the first (and largest) fees you will have to pay, and it is due upfront early in the process.

Closing costs are fees paid to the lender and other parties at the time of closing to complete the purchase. At a minimum, closing costs on average tend to be from 2 percent to 5 percent of the purchase price of the home, although actual costs can vary considerably based on a range of factors.

The specific type of closing costs and their amounts can vary, but some standard closing costs include:

• Mortgage discount points
• Attorney fees
• Title insurance
• Origination fees
• Document preparation fees
• Credit report costs
• Title search/recording fees

Some are these fees are charged by the lender, who may require payment from the buyer earlier in the process, at a point prior to the actual closing.

An appraisal is generally done prior to the final approval of the mortgage, so this fee would either be paid at that point or as part of the closing costs. A home inspection is also usually required prior to final approval. A basic home inspection will likely cost at least $300 to $500, according to the U.S. Department of Housing and Urban Development, but costs can vary quite a bit depending on the size, location and condition of the property. Additional inspections to look for specific issues may be required by your lender and/or local codes.

Often, payments for property taxes and homeowner’s insurance are held in escrow and bundled in with your monthly mortgage bill, for a combined amount that’s known as the PITI (monthly principal, interest, taxes, and insurance). Depending on when tax payments are due and what kind of initial payment your insurance company requires to initiate coverage, you may need to pay a considerable portion of your first year’s costs for taxes and insurance at the time of closing. The Trulia mortgage calculator can help you estimate your total monthly mortgage bill.

If your down payment is below a certain amount—generally, less than 20 percent on a conventional loan—there’s a good chance you will have to pay private mortgage insurance (PMI). As the Consumer Financial Protection Bureau explains, you may pay for PMI as a one-time fee at the time of closing, as a fee that’s added to your monthly mortgage payment, or a combination of both.

Once you have bought a house, you will be responsible for an assortment of recurring expenses involved with maintaining and keeping the property. For those new to homeownership, some of these expenses may be a not-so-welcome surprise. Maintenance costs for the home and surrounding property are a shock to people who previously rented and had a landlord who covered those costs. Homeowners also often underestimate the cost of utilities, especially if they are stepping up to a much larger property than they had previously. Even for those who have owned property before, homeowners association or co-op/condo fees may be a new experience for those who haven’t had those bills in the past.

Getting the best terms on your mortgage loan can help keep your monthly payment within your budget. Let Trulia help you explore your mortgage options, and find a lender who can offer you the right deal for your needs and financial situation.

Empire Appraisal Group, Inc. has been helping clients make informed real estate decisions since 2005.   We are the leading residential appraisal company in Broward County.  We provide accurate and reliable appraisals, excellent customer service, and quick turnaround times.  When working with an appraisal company, integrity and professionalism are essential, and Empire Appraisal Group has a well-established reputation for providing the best appraisal experience.  Daniel Lindeman, the Chief Appraiser, is one of the top property appraisers in Florida, with over 15 years of expertise and over 8,000 appraisals to his credit.