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First time buyers, and even homeowners who haven't purchased a home in quite some time, can be surprised when they learn there are closing costs in addition to their down payment required when purchasing a home. Early in the process, whether with your Realtor® or lender, closing costs should be discussed so those don't come as a surprise down the road. Closing costs may include, but aren't limited to:
- loan origination fee
- appraisal fee
- pre-paid homeowner insurance
- pre-paid condo HOA fees
- pro-rated real estate taxes
Typical closing costs can be estimated at about 3% of the purchase price. To the closing costs add the down payment for the total funds needed for your purchase.There are excellent loan programs available with as little as 3% down and down payment assistance programs, so its definitely worth the time to explore loan options early in the process.
If you plan to buy a home in 2016, now is the time to meet with your lender and Realtor® to start the home search and loan approval process. Locally the "spring" market swings into gear by late January. Stay ahead of the game (and other buyers) by having your loan approval finalized and start educating yourself on which communities best fit your budget, lifestyle, commute, etc.
