The Costs of Owning a Home
Author: Lee Keadle
Some home buyers (especially first-time home buyers) think that
a down payment is the only cost of buying a home. However, they
soon realize that their down payment is one of many costs that
require cash or a check upfront. So, how much should you expect
to pay before closing on your new home?
Depending on the type of mortgage you choose, you will probably
make a down payment anywhere between zero and twenty percent of
the purchase price of your home. This range is very large, but
the good news is that you get to choose what size down payment
you'll make in the very early stages of house hunting. You can
talk with your home loan officer to find out what mortgage type
is best for you (and this decision will largely be based on how
much money you can put towards a down payment).
Your down payment is usually the largest expense in buying a
home, but remember that it is not the only cost. There are
several other expenses that can add up to be quite a bit of
money. Usually these costs total anywhere from three to eight
percent of the purchase price of your home.
When buying a home, you should expect to pay for certain items
and services throughout the home buying process. These expected
costs are called buyer costs, or buyer expenses. Some typical
buyer costs include the inspection(s), appraisal, surveys, title
insurance, escrow items, attorney fees, and mortgage fees
(credit report fees, loan origination fees, points, interim
interest, and transfer fees, to name a few). Also, most home
insurance companies require at least one month's payment before
the closing (and some companies want the entire year's payment
upfront). Since no two real estate transactions are the same,
you should get your buyer's expenses confirmed before signing a
contract. It's true that there are typical buyer costs and
seller costs, but it's a good idea to get these in writing so
that you know how much you'll need to spend during the home
buying process.
Some of the typical seller costs, or seller expenses, include
the CL-100 (also called the termite inspection bond), deed
stamps, the home warranty, commission for both the listing real
estate agent and the agent representing the buyer, possible home
repairs, and accrued interest.
About the author:
Lee Keadle is a full-time real estate agent in Charleston, SC.
He works with a team of three agents to give buyers and sellers
the best services possible. You can search for homes and vacant
land on our website at
http://www.searchforcharlestonrealestate.com/new-construction.php
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