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Preparing for Your First Mortgage Payment: Key Details to Know

Preparing for Your First Mortgage Payment: Key Details to Know

After buying your home, it’s time to prepare for your first mortgage payment. At California Housing Administration we want to help you get off to a great start owning your new home! Here’s everything you need to know about your first mortgage payment, along with a few tips to help you be ready to make your first payment.

Starting Point: Closing Day

Think of closing day as the grand finale of your home-buying journey—the day you officially receive the keys and gain ownership. This is also the day that kicks off the countdown to your first mortgage payment. Unlike rent, which you usually pay at the start of each month for the upcoming period, mortgage payments work in arrears, meaning each payment covers the previous month’s mortgage costs.

When to Expect Your First Payment

So, when will your first mortgage payment be due? Typically, it’s set for the first day of the second month after your closing date. For example, if you close on April 15, your first mortgage payment will be due on June 1. This “payment buffer” gives you a bit of time to settle into your new home and get organized financially for the ongoing mortgage.

Take Advantage of the Buffer

This brief window before your first payment arrives isn’t just a grace period—it’s a valuable opportunity to prepare. Here are a few ways to use this time wisely:

  1. Budgeting: Establish a monthly budget that includes your mortgage, utilities, and any additional expenses that come with homeownership.
  2. Building an Emergency Fund: Having a financial cushion will provide peace of mind for unexpected home repairs or other emergencies.
  3. Early Payments on Principal: If possible, consider making an early payment on your mortgage principal. This can reduce the total interest you’ll pay over the life of the loan and shorten the repayment period.

Reading Your Mortgage Statement

Your mortgage statement provides a monthly breakdown of your payment, including the amounts applied to principal, interest, and any escrow contributions for property taxes and insurance. Familiarizing yourself with this statement will help you make informed financial decisions and understand where each portion of your payment is going.

The Path Forward

Your first mortgage payment is just the start of a new financial journey. Whether you plan to make additional payments to pay off your mortgage sooner or simply want to stay on track with monthly payments, starting with a clear strategy can set the tone for long-term success in homeownership.

With a well-prepared approach to your first mortgage payment, you’re ready to settle in and enjoy the rewards of owning your new home.

If you would like to buy a home, give California Housing Administration a call today!