Purchasing a home marks a significant milestone, whether it's your first venture into homeownership or you're adding another property to your portfolio. Beyond the price tag of the home itself, there are additional costs to consider. Some of these expenses are one-time fixed payments, while others represent ongoing monthly or yearly commitments. While not all costs apply to every real estate transaction, being aware of the following items can prevent any surprises on closing day.
Property Inspection Fee: Investing in a professional inspection (typically costing between $500 to $800) provides a comprehensive report on the property's structural integrity and any areas requiring repairs.
Appraisal Fee: When securing a mortgage, lenders typically require an appraisal of the property, with fees ranging from $400 to $600. Typically lenders will cover this cost themselves.
Property Insurance: Coverage for the home's replacement value and contents is essential, typically costing between $1,000 to $1,800 to satisfy lender requirements.
Service Charges: Installation fees for utilities like telephone, water, electricity, gas, and cable range from $50 to $175, depending on the service.
Legal Fees: A lawyer's review of the real estate transaction is crucial, with fees determined by complexity. It's advisable to shop around and request estimates before hiring.
Mortgage Loan Insurance Fee: Depending on the down payment, lenders may require mortgage loan insurance, typically ranging from 0.6% to 4% of the mortgage amount.
Moving Costs: Professional movers' fees range from $65 to $100 per hour for a van and two movers, potentially higher during peak times
Property Tax Adjustment: You have to pay the taxes upfront for the number of days you own the house in the calendar year of purchase.
Understanding these costs upfront allows for better financial planning and ensures a smoother home buying process.