Purchasing a home is arguably one of the biggest financial decisions you will make in your lifetime. As you start your hunt, don’t forget there will be other costs associated with your purchase then the price of the home. Here are 5 fees to keep in mind as you begin to budget.
- Home inspection. This is a crucial step in the home buying process. This is a step we highly recommend you do not skip! The findings that come from the inspection can help you negotiate price and repairs. Generally, you can expect to pay between $300 to $500 depending on the home and the location.
- Title services. Title services encompass the transfer of the title from the seller and a thorough search of the property’s records to ensure to no one will pop up with a claim to the property. Additionally, you may need to buy title insurance which will protect the lender or your investment in the home. Purchasing Personal Title Insurance at the time of closing is the cheapest option and will save you lots of money in the long run if something from the past sneaks up on you.
- Appraisal fee. Before getting a loan, you will likely be required to get an appraisal of the home to determine its estimated value. This will be conducted by a third-party company and the cost can land anywhere between $300 and $1,000, depending on the size of the home. The appraisal will make sure you are not overpaying for a property.
- HOA fees. Many communities have a homeowners’ association that enforces monthly or yearly fees. This money is used for general maintenance and updates to areas like pools, parks, and more. Fees will vary depending on the type of home and which community it is located in. For new owners’ some communities have upfront costs to join the community. Talk to your agent for more information.
- Taxes. The taxes each buyer pays at the closing table differ, but it is not uncommon for it to be up to two months’ worth of county and city property taxes. Additionally, there may be taxes for the transfer of the home title.
Talking with your realtor can help you navigate through all the different issues and fees you may encounter. They are a great resource to point you in the right direction of who you can talk to for more help.