When buying a home, your focus may purely be on the down payment, but there are other costs associated with buying your home. Learn more about what costs to plan for, what can be avoided and what is not optional.
#1 Closing Costs
According to Zillow.com “home buyers will pay between about 2 to 5 percent of the purchase price of their home in closing fees. So, if your home cost $150,000, you might pay between $3,000 and $7,500 in closing costs.” Closing costs vary from transaction to transaction but include a fee from the mortgage broker and lender, fess from any local and state taxes, and fees for a lawyer to oversee the transaction.
#2 Moving Costs
Moving can get expensive! It’s not just your stuff you have to worry about. If you are currently renting, are there any repairs you need to make to get your security deposit back? If you are selling your current home, do you need to make any repairs to get it in sellable condition?
#3 Home Repairs + Personalization
Even if you are buying a brand new, move-in-ready home, there will most likely be some repairs and personalization you will want to do. Picking the perfect paint colors and furnishings is one of the best parts of owning your own home. Make sure to leave some room in the budget to make your new house your perfect home.
#4 HOA fees
The worst thing about HOA fees is they aren’t a one-time fee. While some HOAs will have move-in fees and other upfront deposits, most are a flat monthly payment. When calculating what homes you can afford, make sure you include the HOA fee in your monthly expenses.
#5 Home Inspection + Survey Costs
No matter how expensive a home inspection and survey may feel, they are 100% worth it. Knowing where your property lines are and if there are any costly potential issues with your home will pay off in the long run. Even if a home appears to be in perfect condition, home inspectors are trained to look for underlying issues.
Though buying a home can be costly, most homeowners feel that the pride of ownership is worth every penny. As long as you carefully plan for costs and stay within your budget, purchasing a home will be a fulfilling and pleasant experience.