4. One of the advantages of buying a home with a fixed- rate mortgage is that your payment stays the same but your earnings and the value of your home are likely to go up, if only because of inflation. You will be paying back the loan with dollars of lesser value. Suppose you buy a “starter” two-bedroom home for $105,000 under a special program for first-time home buyers that requires a down payment of only $5000. You have a 30-year, fixed-rate mortgage for $100,000 at 7%, on which the monthly payment is $665.30. You also have a $2000 one-time expense in closing costs and annual costs of $200 for insurance and $2000 for property taxes. You live in the home for 5 years and spend $10,000 on maintenance, upkeep, and improvements. You then sell the home for $125,000, pay a realtor $9000 to sell it, and pay closing costs of $500 (for title insurance and other costs). Finally, it costs $3000 to move.