Most first-time homebuyers spend considerable time contemplating their mortgage loan options and reviewing common expenses that come with purchasing property. However, few stop to consider the homebuying fees that often hit near the end of the homebuying process. For some, they really add up and precipitate serious financial trouble.
If you’re looking to buy a home, factor these smaller fees into your housing budget. You’ll be glad you did.
Appraisal and inspection costs
Most lenders require buyers to organize a home inspection and appraisal before closing, according to U.S. News and World Report. State-certified inspectors normally charge several hundred dollars per inspection. From a quality control perspective, the spend is worth it, as these structural experts can spot serious problems and save you from investing in damaged property requiring extensive repairs. Appraisers perform similar evaluations to determine fair market value for your home, the National Association of Realtors reported.
Even first-time buyers know they must pay property taxes. Unfortunately, many fail to realize that they have to pay these fees before taking possession of their new home. Lenders offer escrow accounts. Still, many home hunters are confounded by this system. So, familiarize yourself with escrow and be prepared to pay up.
Real estate experts and lenders routinely remind homebuyers to consider closing costs. Yet, many, caught up in house hunting fever, forget and only remember when it comes time to sign the check. So, remember, you must pay closing costs.
These amounts normally include attorney, property transfer and title insurance fees. Closing costs vary depending on the location.
Once you’ve purchased your new home, you’ll most likely have to pick up some new furnishings. Despite the availability of cheap modular furniture and the rise of thrift stores, these costs can add up, especially if your new home is particularly roomy.
Depending on your tastes and income, you could spend anywhere from a couple grand to tens of thousands, the NAR reported. But no matter how far you decide to go from a design perspective, consider waiting a few months to invest in home-wide decoration efforts.