“How much does a new home cost?” “What will I have to pay for a home” “How can I save from home-buying costs?” – these are the questions real estate professionals face on a daily basis. Being an experienced individual in real estate myself, I may be able to shed some light on this topic. Here are the costs that you need to pay when you buy a home –
Things you need to pay for when you buy a home
1. The Down Payment
Down payment is the percentage of the home price which you need to pay upfront. The percentage depends on the financing option of the buyer. These following three loan products are the most common ones that buyers can take advantage of.
1) Conventional loans
2) FHA loans
3) VA loans
2. Real Estate taxes
Real estate taxes are one of the bigger chunks of the total home buying costs. This expense depends on the state you are buying. Some states/cities have higher tax rates than others.
3. Homeowners insurance
For a mortgage on a home, you’ll need to have a home insurance. This insurance will cover the home owner from any damage that happens to your home.
4. Appraisal fee
Appraisal fee is something you’ll need to pay upfront. Every time you are obtaining mortgage financing, the bank will ask for an appraisal to be done. The appraisal could be best described as the unbiased evaluation of your home value to ensure it is at least the value which both seller and buyer agree too. This appraisal cost will vary depending on your home, financing option and your situation but usually, it’ll fall anywhere between $350 to $500.
5. Inspection cost
It is exactly what it sounds – costof inspection. The inspection cost will vary depending on a few factors. Size of your home, number of chimneys, mold and pest situation among others. The most common inspection costsare home inspections,radon tests, chimney inspections, and pest inspections. The home inspection cost will be applicable for all the whole home while the chimney and pest control inspection cost will depend if required.
6. Real Estate attorney fee
Not hiring a real estate attorney is one of the most common mistakes people make, especially new homeowners. It’s important that you hire someone who has the expertise and has been practicingin real estate for years. A good real estate attorney should cost around $400 to $1,000 when purchasing.
7. Renovation cost (If you are buying and old house)
Renovation cost is something you need to bear if you are buying an old house. For example, if you have leaky plumbing, you’ll have to hire a plumber to fix the situation. Or you could want a new wall dividing the dining. These costs are something you’ll have to pay upfront.
Other costs you’ll have to pay in future
These are the costs that you’ll have to pay once or on a regular basis in future as you buy a new (or old) home –
1. Utility cost
2. Mortgage Insurance Premium
3. Maintenance cost
3. Moving cost
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