Rethink Everything About Advising on the Total Cost of Homeownership

First-time homebuyers often enter the process laser-focused on two numbers: the home price and the monthly mortgage payment. But the reality of owning a home extends far beyond those two figures. For our July articles, we want to help loan officers communicate to homebuyers what really makes up the total cost of homeownership and how understanding this early can prevent surprises and lead to smarter, more confident decisions.

The Hidden $21K: Why Teaching Total Cost of Homeownership Sets You Apart
Brian Vieaux, President & COO, FinLocker

Hidden Homeowner Costs That Catch Every Buyer Off Guard
Mike Cush, Mortgage Sales & Customer Strategy Consultant

The HOA Factor: What Buyers Need to Know
Brian Vieaux, President & COO, FinLocker

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The Hidden $21K: Why Teaching Total Cost of Homeownership Sets You Apart

Brian Vieaux, President & COO, FinLocker

Here’s the conversation most homebuyers never have with their loan officer and it’s costing them dearly.

When renters transition to homeownership, their mindset needs to shift just as dramatically as their living situation. Yet too many buyers approach their new mortgage payment exactly like they approached rent: as a fixed monthly expense with little thought beyond the four walls.

They calculate principal, interest, taxes, and insurance, check that box, and move forward. What they don’t account for is the reality of homeownership: the water heater that fails at the worst possible moment, the home insurance premium that jumps after the first year, the utility bills that spike in extreme weather, or the HVAC system that decides to quit during the hottest week of summer.

Six months after closing, these unprepared homeowners find themselves financially stretched, stress-filled, and questioning whether they made the right decision. This isn’t a problem with interest rates or market conditions. It’s a readiness gap that we have the power to bridge early in their journey.

Elevate Your Role: From Transaction to Transformation

The loan officers who thrive in today’s market understand that their value extends far beyond rate quotes and document collection. Today’s homebuyers, particularly first-time buyers, need a trusted advisor who guides them through preparation before the loan, sets them up for success after closing, and provides ongoing support for long-term homeownership sustainability.

Recent data from Bankrate’s 2025 Hidden Costs of Homeownership study reveals that the average homeowner now spends $21,400 annually on expenses beyond their mortgage payment. Maintenance alone averages nearly $9,000 per year. These aren’t minor inconveniences — they’re the expenses that drain emergency funds and create buyer’s remorse.

Smart Solutions for Sustainable Homeownership

Consider the approach Susan Malpocker, Regional Sales Director at Click n’ Close, shared with me recently about their innovative down payment assistance program:

“Our down payment assistance program, Smart Buy, combines an FHA or USDA 30-year fixed with a second lien that’s either fully forgivable after 5 years or repayable over 10 years with a 30-year amortization for improved cash flow. The second lien helps with affordability while promoting sustainability by allowing homeowners to retain more cash reserves for unexpected expenses that inevitably arise after closing.

Within Smart Buy, we also offer solutions like a Shared Appreciation Mortgage with below-market rates, temporary interest rate buydowns, and even a 203k Limited for homes that need renovations. It’s incredibly rewarding to help overcome the real obstacles to long-term homeownership success.”

This represents the kind of forward-thinking approach our industry needs more of — programs that don’t just qualify buyers, but truly equip them for successful homeownership.

Check out Down Payment Resource to find programs for your clients. They have identified over 2,0000 homeownership programs, and 39% of the programs are for repeat homebuyers!

Your Opportunity to Lead

Here’s how you can differentiate yourself and provide genuine value:

• Comprehensive Budget Education: Walk buyers through a complete ownership budget that includes maintenance reserves, insurance fluctuations, and seasonal utility variations alongside their mortgage payment.
• Financial Preparedness Tools: Introduce resources like KeySteps, powered by FinLocker, which help buyers monitor credit, plan finances, and build financial buffers for homeownership expenses.
• Professional Network Connections: Connect new homeowners with trusted local professionals including insurance agents, maintenance contractors, and financial advisors who can support their long-term success.
• Ongoing Value Delivery: Follow up with educational content and market insights rather than generic “checking in” messages that add no value.

Your Opportunity to Build your Brand

Imagine being known as the loan officer who:

• Helps buyers think like owners from day one
• Introduces programs that preserve cash flow and provide financial breathing room
• Becomes the reason clients not only stay in their homes successfully but return for future transactions and refer their friends and family
• Transforms the mortgage process from a stressful transaction into an empowering educational experience

This is how you evolve from being a forgotten transaction facilitator to becoming a trusted, long-term financial advisor.

In a competitive market where rates and programs can be found anywhere, your differentiation comes from the guidance, preparation, and ongoing support you provide. Be the loan officer who educates thoroughly, prepares comprehensively, and delivers consistent value.

That’s how you build lasting relationships, generate referrals, and create a sustainable competitive advantage that transcends market conditions.

Hidden Homeowner Costs That Catch Every Buyer Off Guard

Mike Cush, Mortgage Sales & Customer Strategy Consultant

I consider myself a planner. I make a spreadsheet before any trip with every little detail. If I am getting time off work and spending lots of money, I don’t want to leave anything to chance. Sounds fun, I know. When I bought my first house, I planned. I researched. I thought. And boy, did I miss some stuff.

I had toured the house a few times – always on weekdays. When I closed and was there the first night, there was nowhere to park. Not a single spot. It was a townhouse with a one car driveway, I had two cars, and obviously so did everyone else. The street was packed. Lesson learned.

The next house I bought had some giant, ancient oaks. The kind that gave shade to the entire yard. Beautiful old trees. I thought about sitting outside in the summer, shaded by the cover they provided. I closed on Halloween and the morning of closing I went for a walk through. What I didn’t think about was that there was going to be literally 2 feet on leaves on the entire property. Knee deep. That means you either give up college football or pro football in the fall. You are out in the yard, raking. A lot.

You don’t want to plan like I planned. You want to do it better. Some things I got right. I took the age of every major appliance in the house, compared it to the average useful age, and figured out when I would need to be replacing them so that I could budget for that. I did the same for the roof, the driveway, and the garage doors.

I also thought about the furniture, rugs, and lamps that I had – versus what I would need in the new house. And I budgeted for that as well. And I thought about one thing that I always told borrowers who thought they were going to be fine spending their last dollar at closing and moving into a house – you’re gonna need blinds! Immediately. And they aren’t cheap.

You don’t want to be the person that sells doom and gloom. After all, sales is often about the transfer of enthusiasm. But you do want to be the expert that is 100% on their side, because having someone on their side who tells them what they need to know is really the product they are buying from you. And you should always sell what people are buying.

The HOA Factor: What Buyers Need to Know

Brian Vieaux, President & COO, FinLocker

If your buyers are looking at homes today, they’ll likely see lots of communities with a Homeowners Association. In 2024, 40.5% of for-sale listings had an HOA fee. HOAs are more common with new construction homes, with 69.9% of new builds having a monthly homeowners association fee compared with 38.2% of existing homes.

HOAs offer both benefits and drawbacks. Here’s what buyers should know before signing a home purchase agreement.

👍 The Upside: Value, Amenities & Maintenance

Shared amenities & services

Many HOAs include pools, landscaping, common property maintenance, fitness centers, pest control and security, which are expensive and time-consuming to maintain on your own. Over 70% of homeowners consider their dues reasonable given the benefits.

Higher property values

Homes in HOA neighborhoods tend to have a higher resale value thanks to consistent upkeep, uniform aesthetics, and shared amenities.

👎 The Downside: Fees, Rules & Frustration

Monthly fees aren’t included in your mortgage, but they do impact your monthly budget.

The national average is around $259/month – higher for condos (e.g., $375/month) and lower for single-family homes (~$58/month), according to the National Association of REALTORS®. These fees can rise due to inflation and increasing costs for maintenance, insurance, or community improvements, so it’s important to budget a 5-10% increase each year, outside of any special assessment that could be levied due to an unforeseen or ill-planned maintenance or repair to the property, such as new roofs, walkways, foundation.

Dissatisfaction is common

57% of HOA residents dislike living under one, and 10% have considered selling to escape HOA oversight. Only 47% say their HOA makes their neighborhood better.

Restrictions and conflicts

HOAs control everything from paint colors to parking. Depending on the community, rules can feel restrictive and sometimes even petty. If violations occur, fines often follow.

What Buyers Should Do

Ask the right questions before signing:

• What is the current HOA fee, and how frequently has it increased?
• What expenses are covered? What’s not?
• Are there any pending special assessments (e.g., roof replacements)?
• Is the HOA adequately funded? Does it have a solid financial reserve?
• What restrictions are in place for pets, exterior changes, holiday decorations, renting the property, etc.?

Do your homework:

• Request and review governing documents: CC&Rs, bylaws, budgets, financials
• Check meeting minutes for evidence of unexpected costs or internal conflict
• Research online reviews of the property management company or ask neighbors about their experience
• Ask your real estate agent or lender if they have worked with previous buyers who have bought a home in that property.

An HOA can enhance your neighborhood, protect your investment, and provide shared amenities. But it can also bring rules, rising costs, and frustration. The secret is doing your research to decide if the community fits your lifestyle, budget, and long-term plans.

As a loan officer, you can become an invaluable partner by educating them on how their HOA fees will impact their total monthly cost of homeownership, and remind them of the importance of thoroughly reviewing all documents to make an informed decision.