For many new home buyers, buying a house seems as simple as writing a check for the down payment on the loan. While this is certainly part of the process, it’s not the only thing you’ll have to pay for. In fact, there are many different fees that buyers have to pay before they can get the keys to their new home. The last thing any buyer wants to deal with is an unexpected fee when they’re already putting thousands of dollars on the line. Here are a few costs you’ll need to prepare for when buying your first house.
No matter how great the house is, it’s always in your best interest to schedule an inspection before you buy the house. This inspection will let you know if there are any underlying issues with the house that could derail your budget or pose a safety hazard once you move in. The cost of the inspection will vary based on the size of your house and the experience the home inspector has.
The Home Appraisal
Before your lender will approve your loan in full, they’ll want to get the property appraised. This appraisal tells your lender if the home is worth what you’re wanting to borrow. If the home isn’t worth the amount you’re asking for, the lender may deny the loan. Unfortunately, you’ll have to pay for the appraisal out of your personal savings.
No matter what type of loan you use to finance your house, you’re going to have to pay certain closing fees before you can get the keys to your new home. The closing costs may include any fees associated with the loan, title costs, escrow account fees, and attorney fees. Keep in mind that some of those fees can be negotiated with the sellers if you want to lower your out-of-pocket expenses.
Depending on your lender, you may be required to pay for a full year of homeowners’ insurance at the time you buy your house. The best thing new home buyers can do to reduce this expense is to shop around for insurance. Choose a provider that offers you the best price without sacrificing quality of coverage.
Now that you know the most common costs that new home buyers face when buying a house, you can prepare yourself. Boost your savings and try to cover those costs before you make an offer on a house. Once you’re ready, apply for your home loan online.