Purchasing a home is arguably one of the biggest financial decisions you will make in your lifetime. Much of your focus early will be related to financing: what type of loan to choose, or to pay in cash. As you start your hunt, don’t forget there will be other costs associated with your purchase then the price of the home beyond the fees and commissions of loan officers and real estate agents… Here are 5 costs to keep in mind as you begin to budget.
- Home inspection. This is a crucial step in the home buying process. The findings that come from the inspection can help you negotiate price and repairs. Generally, you can expect to pay between $400 to $600 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.
- 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.
- HOA fees. Many communities have a homeowners’ association that enforces monthly fees. This money is used for general maintenance and updates to areas like pools, parks, and more. We mostly HOA fees anywhere between $500 – $1500 per year.
- Taxes. The taxes each buyer pays at the closing table differ, but it is not uncommon for it to be a few months’ worth of county and city property taxes. Additionally, there may be taxes for the transfer of the home title.
While there can be other costs involved with buying a home, these are the most common. We educate all our clients up front through a customized Buyer’s Playbook that helps answering questions long before they are asked. For buying and selling All Things DFW, contact The Burke Team!