When you're purchasing a home, it's important to understand that there are many expenses involved beyond just the purchase price. These costs can add up quickly, so it's essential to be prepared and budget accordingly. To help you, we'll break down some of the main expenses you can expect when purchasing a home.
Down Payment
The down payment is the amount of money you pay upfront to secure the home. The more you pay upfront, the less you will pay in monthly mortgage payments. This amount is typically a percentage of the purchase price, usually between 3-20%.
Closing Costs
Closing costs are the fees associated with closing the sale of the home. These can include title insurance, appraisal fees, attorney fees, and transfer taxes. Closing costs typically range from 2-5% of the purchase price.
Home Inspection
It’s not mandatory, but it is beneficial to have your home inspected by a professional. The inspection will help identify any potential issues with the home, such as plumbing or electrical problems. The cost of a home inspection can vary depending on the location and size of the home, but expect to pay between $300-$500.
Appraisal Fees
When you apply for a mortgage, the lender will require an appraisal of the property to determine its value. The cost of an appraisal can vary but typically costs between $300-$500.
Property Taxes
Property taxes are assessed by the local government and are based on the value of the property. The amount of property tax you'll pay can vary depending on the location and value of the home.
Homeowners Insurance
Homeowners insurance protects your home and personal belongings in case of damage or theft. Your insurance costs will vary depending on the value of your home, and the location.
HOA Fees
If you're purchasing a home in a planned community, you may be required to pay homeowner association (HOA) fees. These fees cover the maintenance and upkeep of shared amenities such as community pools, landscaping, and security.
Repairs and Maintenance
Once you've purchased the home, you'll be responsible for any repairs and maintenance that are needed. It's important to budget for these expenses and set aside money each year for repairs and maintenance.
As you can see, there is more to buying a home than meets the eye. Being prepared for these additional costs is crucial to guaranteeing that your homebuying experience is as smooth as possible. Connect with one of our agents to see easy it can be to find your dream home.