Home Closing Cost
Home closing cost. BEWARE!
Buying a home is both an enjoyable process, and one that can cost you and arm and a leg. Many first time home buyers are unaware of the fees that proceed after you make the commitment to purchasing a home. Not only does purchasing a home put a whole in your pocket, but the closing cost can leave one gasping for air if not aware of the cost and fees that follow after they have committed to buying the home. Being aware of these cost is something that everybody should be aware of when they first purchase a home.
What might have started as an experience of joy at first for some people, can end up becoming a burden of regret. Being aware of the home closing cost can allow first time home buyers to budget the right amount in advance in order to diminish any financial stress that arise for those that are unaware of these cost. Since purchasing a home has many home closing cost, the most common types of fees that everyone should be aware of are as follow:
HOME CLOSING COST TO BE AWARE OF IN BUYING A HOME
- Loan origination fees and charges can be estimated to about 1-2% of the loan amount and as much as 3%.
- Escrow fees: preparation of home documents. Hundred thousands of dollars.
- Home owners insurance.
- Title insurance: you should only pay this here.
- Property tax fees
- Attorney Fees.
- Property inspections. Can be several hundred dollars.
- (PMI) private mortgage insurance). If you make less than a 20% down payments.
- Pre-paid loan interest. Consist of the amount of interest accrued within the first month.
- Other fees: For example, recording fees like a notary 200-300$.
OTHER THINGS TO KEEP IN MIND
- Keep in mind that, all fees disclosed before the loan is processed can be negotiated. Types of these fees consist of those to underwrite your loan, fees to wire your loan, and other miscellaneous fees.
- SCHEDULE TO CLOSE ON LOAN A FEW DAYS BEFORE THE FIRST PAYMENT IS DUE SO THAT YOU CAN AVOID THE PREPAID LOAN INTERST. Close on the 1st or a few days before is generally best.
- Try to adjust date of closing to the monthly due date!
KNOWING ALL THE STEPS NECESSARY IN PURCHASING A HOME IS VERY BENEFECIAL! When it comes to buying a home there are a lot of uncertainties that a new home buyer is unaware of. Being aware of the different types of closing cost that a home buyer will have to pay, will make the home buying process one that is very enjoyable. No longer do first time home buyer have to be caught by surprise with the home closing cost that they will have to pay. At time purchasing a home carries an uncertainty of whether or not a good choice was made, but buying a home for the first time should be an experience that brings happiness for many. So remember plan ahead and may your first home buying experience be a great experience.