Home Buying Costs Hiding from Your Wallet
You found the perfect home and you’re ready to put in an offer, but what happens once the approval comes through? For some, they view the listing price as the only costs accrued from this life-changing purchase, but that isn’t the case. Zillow estimates that Americans pay an additional $9,000 per year on average on hidden homeownership costs. Take a look below to learn about the top costs that are commonly overlooked when buying a new home.
Before closing, it is important to send the home you have your eye on through various inspections. When the inspector arrives on site, he will examine the foundation, roof, electrical and more. Depending on the outcome, this can potentially add up to thousands of dollars and will be your first major cost in acquiring your new home. A quality inspection may cost a pretty penny, but will be money well spent in order to avoid any unforeseen problems in the future. Additionally, to make sure you get the best inspection for your money, follow this checklist!
Some of the most frustrating hidden charges when buying a new home are closing costs. Many homebuyers put their sole focus on the down payment and forget about closing expenses at the end, typically costing anywhere between 2%-5% of the home price. These additional fees should not be ignored as they are another major figure that can catch many people by surprise, and its money that you don’t recoup. See below for a handful of closing fees to consider in your budget:
- Appraisal fee: the professional estimate of the home’s value
- Survey fee: the cost for verifying a home’s definitive property lines
- Wire transfer fee: the charge to wire funds to purchase the home
- Underwriting and origination fees: the charge associated with evaluating, verifying and processing the loan application
- Document prep fee: the cost associated with prepping your loan documents for processing
Once all the paperwork is signed and the inspections are completed, all that’s left is to move into your new home! Depending on the number of belongings you will be moving with, it is a good idea to plan for your moving costs to range anywhere between $500-$1,000. For some, starting fresh with all new furniture is a more desirable route, so it is smart to factor that situation into your budget as well.
Mortgage Insurance and Taxes
When looking at estimated monthly payments on a home loan, there is a high possibility that the insurance and tax is not included. These two costs can be crucial to making or breaking a homebuyer’s budget and can easily sneak by. Mortgage insurance can range from 0.5% to 1% of the total loan, while the taxes depend on the value of the home.
Buying the home of your dreams is a huge step, so make sure the right people have your back when pulling the trigger. At Points West Agency, we’ll guide you through the process of finding the perfect North Texas home while keeping your entire budget in mind! To speak with our agents and find more information, give us a call at (817) 717-6036 or visit our Contact Us page.