It’s very important to make all your payments on time. Your lender will set-up an automatic payment from your chequeing or savings account. You may want to inquire about overdraft protection for this account as additional protection. Late payments will negatively affect your ability to obtain additional credit such as credit cards or even a mortgage renewal. If you fail to make payments your lender may initiate foreclosure which may lead to a court ordered sale of your property.
Plan for Maintenance Costs
Set aside at least 15% of your mortgage payment as a cushion against unexpected repairs or planned updates. It’s much better to have these funds saved than it is to borrow for a new roof or emergency repairs. If you are buying a condominium, this amount will cover future special assessments, etc. Condominiums sometimes bill owners for big expenses like windows, landscaping, etc. and the amounts can be in the thousands.
Set a Household Budget
It’s a good idea to create a new budget even before you buy your home. Try to live within this budget for at least six months to be certain you are ready. After you buy, adjust this budget to allow for savings for maintenance but also personal savings of at least 10%.