Extra Costs to be Aware of Before Buying a home
Whether you are looking to buy your first home, or trading up to a larger one, there are many extra costs – on top of the purchase price – that you must figure into your calculation of affordability. These extra fees, such as taxes and other additional costs, could surprise you with an unwanted financial nightmare on closing day if you are not informed and prepared. Find out about a closing costs you can here.
Some of these costs are one-time fixed payments, while others represent an ongoing monthly or yearly commitment. Not all of these extra costs will apply in every situation, however it is better to know about them ahead of time so you can budget properly.
Remember, buying a home is a major milestone. Whether it is your first , second or tenth home, there are many important details to address, during the process. the last thing you need are unbudgeted financial obligations cropping up hours before you take possession of you new home.
Read through the following check-list to make sure you are budgeting properly for your next move.
- Appraisal Fee. Your lending institution may request an appraisal of the property which be your responsibility to pay for. Appraisal can vary in price from approximately $175-$400
- Property Taxes. Depending on your downpayment, your lending institution may decide to include your property taxes in your monthly mortgage payments. if your property taxes are not added to your monthly payment, your lending institution may require annual proof that your taxes have been paid.
- Survey Fee. When the home you purchase is a resale, your lending institution may ask for an updated property survey.
- Property Insurance. Home insurance cover the replacement value of your home (structure and contents). Your lender will request proof that you are insured as it protects their investment on the loan.
- Service Charges. Any new utility that services your hook up, such as telephone or cable, may require an installation fee.
- Legal Fees. Your should have a lawyer involved to review all paperwork. Shop around, as rates vary greatly depending on the complexity of the issues and the experience of the lawyer.
- Mortgage Loan Insurance Fee. Depending upon the equity in your home, some mortgages require mortgage loan insurance. Usually payments are made monthly in addition to your mortgage and tax payment.
- Mortgage Brokers Fee.
- Moving Costs.
- Maintenance Fees. Condos charge monthly fees for common area maintenance.
- Water Quality and Quality Certification.
- Local Improvements. In the town you live in has made local improvements (such as the addition of sewer or sidewalk), this could impact a property’s taxes by thousands of dollars.
- Land Transfer Tax. This tax is applied whenever property changes hands and the amount that is applied can vary.
Use this calculator to see how much you’ll have to pay for settlement services, title insurance, as well as recording fees and transfer taxes Estimate Closing Cost