What financial risks do I need to be aware of?

The financial risks when you own a home are related to: • An increase in your monthly living expenses—it costs more to own a home than to rent an apartment. • “Outfitting” your home with furniture and appliances. • The need to fix things when they break—you are your own landlord! • Current real estate conditions when you are ready to sell your home—it might not sell as fast as you need it to. Your monthly expenses will increase. • Mortgage. Your monthly mortgage payment may be higher than your current/previous rent. • Homeowner’s insurance. Habitat for Humanity requires you to have this insurance. It covers your home, your belongings (furniture, clothing, and so on), and accidents that occur on your property. • Additional utilities and services. You may pay for heat and electricity now; you’ll also start paying for: • Water and sewer • Garbage and trash collection • Telephone and Internet connection • Subscription to cable or satellite TV

You will supply your own appliances
When you rent, appliances usually come with an apartment. As a homeowner, you may need to provide your own. And if they break down, you’ll need to repair or replace them.
• Washer and dryer
• Refrigerator

However, depending on the Habitat chapter, they may have relationships with companies that can provide those appliances. Check with your local chapter.

You may want to furnish your home
If your Habitat for Humanity home is bigger than your previous residence, you may want to buy more furniture.

You are your own landlord
Your Habitat for Humanity home will be in good working condition when tyou move in, even if it is a rehabilitated house (not brand new). The need to repair or replace things will be minimal early on. But you’ll still need to maintain all the items in your home to keep them running smoothly. And things do break—sometimes when you least expect it. Here is a list of things in your home you’ll need to take care of.
• Water heater
• Gas furnace
• Lawn care
• Windows and screens
• Paint: exterior and interior
• Fences
• Smoke detectors
• Security alarm
• Toilet or plumbing repairs
• Roof repairs
• Gutters and downspouts

You may want to sell your house
At some point, you may want to sell your house and move. Depending on the real estate market in your area, you might not be able to sell your home as quickly as you need to. And you may have the added expense of hiring a real estate professional.

There are two other things to think about if you think you want to sell your house.

First, Habitat for Humanity has the right of first refusal on your home. That means, if you think you want to sell your home, Habitat would have the option of buying it from you without first putting it up for public sale. And second, Habitat has a second mortgage on your home. The second mortgage is the difference between what you paid for the home and its market value. If you decide you want to sell your home, you would become responsible for the second mortgage.