7 First Time Home Buyer Fees That You Might Not Be Aware Of
Buying a home can be a very frustrating experience. You might have been thinking about buying your own home for a couple of years now and you may be very excited to find that it is finally happening for you. In fact, you may even get to the stage where you can’t wait to sign on the dotted line, but at the end of the day, you really do need to think about how your purchase is going to impact you and what you need to do when it is all done and finalised.
This will be your very first property purchase and you may well be used to a landlord taking care of everything for you but when you own your first property, you don’t have access to this luxury. If something breaks, you need to fix it yourself and this can really impact you overall, especially if you can barely afford to make the mortgage repayments.
Unlike rentals, most new homes don’t actually come with all the appliances you need. This means that you are going to have to go out and get yourself an oven, a fridge and everything else before you move in. You can get all of this second hand, but either way, it is something that you need to think about. One of the bigger expenses that you might not have thought about is your window treatments. You’ll want to have curtains in the bathroom and this can cost you a lot of money as well, not to mention that it is something that you might not expect.
As a homeowner you will want to make sure that you protect your investment at all costs. The insurance you pay will protect you from everything from burglary to fire and everything else as well, so as you can see, there are things that you can do to save yourself money in the long run.
When you rent a property, you won’t need to pay any property tax. This is a mandatory, annual fee and it is normally listed on the disclosure. This means that you will always know how much it is going to be but in most cases it will depend on the state that you live in.
This is the money that you send to the seller along with your offer. It shows your seller that you do actually mean business so they can take the home off the market while you get your stuff together. If you do get your offer accepted then this will be added in the closing cost. If it is not accepted, you get it back. It is always a good idea to have around 5% of the total price set to one side for this cost, but the more you can give them, the more likely they are to accept anyway.
Ever since the housing crash that happened in 2008, it isn’t very common for you to find a home that doesn’t require a down payment. After all, you need to prove that you can be responsible enough to make the payments every month and a down payment is a great way to do this. If you are going for an FHA loan then you may be able to pay a much lower down payment however it all depends on your current financial situation.
If you are feeling a little uneasy about all of these expenses, you will feel even worse when you find out that you may even need to pay closing costs on top of all this. The closing cost will cover your preparation fees and it will also cover your attorney fees as well. Make sure that you add on around 4% of your home cost on top of this to cover these types of expenses. A real estate title policy may also be put into place to try and protect the lender against a loss due to title defects or other matters. The insurance will defend the lawsuit if any loss is occurred and this is something that you should certainly consider for the long run. This is a onetime expense when you’re a first time buyer and if you ask anyone who has gone through this in the past then they will tell you what a nightmare it can be.
So as you can see, there are plenty of extras that you need to consider that you might not have even thought about. For this reason, you need to consider them because the last thing you want to do is go to your new home feeling worried and uncertain. Of course, many first time buyers can easily get caught up in a financial worry through overextending themselves with expenses like this so it is always a good idea to contact a professional if you are unsure or uncertain of anything at any time. If you really want to feel secure you may want to consider having an emergency fund in case something happens, because you’d be surprised at how much this can give you the peace of mind you need to truly feel safe and secure.
Why don’t you give some of these a go for yourself today to find out more?
If you have any questions, contact MKT Homes today!