The purchase price is not the only cost that effects your home buying adventure. Whether this is your first home or you are moving up or down in housing there are costs that will have a large effect on your ability to close the transaction. Some are required by your lender some are required by common sense. Make sure you are budgeting for these 10 extra costs. 1)Mortgage Application, Brokers Fees, and Points These costs can amount to thousands of dollars some like the application fee are poc (paid outside of closing) $200 to $500 depending on the lender. Broker fees a percentage of the loan are sometimes waived or rolled into the mortgage. Points .5% to 4.0% of the loan amount can be rolled into the loan or paid at closing this cost is based on your credit and buy down cost of the mortgage. Good idea to shop lenders. 2)Appraisal Fee - $150 to $550 can be higher they vary in price depending on the size of the property, complexity and price range. On larger more expensive properties banks may have an outside appraiser rather than their bank appraiser which will increase the cost. Paid at closing. 3)Survey Fee Your bank or mortgage company may require a survey or updated survey depending on the local custom. Costs are from $400 to $1200 or more, this is one area where common sense says get a survey. A survey will give you the assurance that you are getting the property you think you are buying. It will show all buildings, sheds, garages, decks, porches, driveways, and walkways. It will also show whether your structures encroach on your neighbors property or his on yours. 4)Title Insurance Most lenders require you to pay for a Lender Title policy a must do for you is to get an owners Owners Title Policy this will insure you against any claims of past issues that could affect your ownership of the property. Based on cost of the property several hundred to thousands of dollars. 5)Attorneys Fees- Depending on local custom an attorney may be required. Real Estate transactions are complicated and a good real estate attorney can make a smooth closing. Based on hourly fees or fixed if they handle the closing, plan on $400 to $900. 6)Property Taxes You will be required to reimburse the seller for pre paid taxes or you may be paid from the sellers funds if taxes were not paid. Any event you will put money into escrow usually 3 months that is held by the lender to pay the taxes when they come due. 7)Homeowners Insurance POC 12 months in advance required by the lender.Also 3 months escrow by the lender at closing. Based on cost of the property, type of construction, location, your personal credit rating and previous insurance usage. 8)Homeowner Association Dues/Fees You will be required to reimburse the seller for any pre paid homeowner fees. Depends on subdivision location condos, townhouses, and gate communities will have them. This should be listed on the sellers disclosure documents. 9)Transfer Tax Normally paid by the seller sometimes split with the buyer in the sale price. Some states are as high as 4.5% of the sales price check out state laws could be thousands of dollars. Paid at closing to the state, county and city. 10)Miscellaneous Service Charges First time home buyers get hit hard here check out the hook up fees for electric, gas, cable, and telephone. Also deposits if you have no track record of paying utilities. Hundreds of dollars. |
