3 Unexpected Costs Home Buyers Should Remember

Buying a home is expensive and you want to make sure you do your homework and be prepared when it comes to those expenses that many people don’t think about. Understand closing costs, the benefits of an emergency fund and potential costs on moving day.

  1. Closing Costs

On average, closing costs can range from 2% to 5% of your home’s purchase price. For a $200,000 home, that’s anywhere between $4,000 and $10,000 to cover items like your:

  • Loan origination fee
  • Home and pest inspection fees
  • Appraisal
  • Prepaid property taxes and mortgage insurance
  • Title insurance
  • Recording fees
  • Underwriting fees

You can put money aside for your closing costs, but you won’t have a clear idea of what those costs will be until you receive an estimate from your lender after you apply for your mortgage.

  1. Home-Buying Emergency Fund

Buying a home is a very detailed process and having some extra cash as a cushion can make it a lot less stressful.

A low appraisal, for example, can be an issue since most lenders won’t approve a mortgage that doesn’t meet certain loan-to-value requirements. But, if the appraisal is off by just a few thousand dollars, it’s possible that the buyer and seller can meet in the middle and keep the deal from not falling through.

  1. Moving Day Odds and Ends

Be prepared when your moving day comes around. You will want to make sure that you have the funds to take care of any moving expenses that you might have. This can include:

  • Boxes, bubble wrap and other moving supplies
  • Deposits for utilities
  • Cleaning supplies
  • Appliances that aren’t included in your home purchase
  • Any pre-move-in upgrades like painting, new flooring and closet organization

While you wait for your closing date, get good estimates for what these costs will be: request quotes from moving companies, shop for appliances, etc.

Heritage Trust Home and Real Estate Lending offers members a wide variety of options.

From first time home buyers to rural housing loans, to lot/land programs and jumbo loans, it is our goal to work with members and find the right product to fit their individual needs.

Our Home & Real Estate Professionals can walk you through the entire home loan process so you always know what to expect.

To get started or to learn more, click here!

Source: DaveRamsey.com


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