When it comes to buying a home, it’s easy to focus on just the down-payment. I mean, you’ve taken care of everything else…right?
Save your pennies and don’t go out to eat and get labeled as the “lame friend”…check.
- Talk to a Lender about price point and get pre-approved for the magic number…check.
- Meet with a Remax Advantage Realtor and look at a few homes on the market…check.
- Find the perfect place and submit an offer…check.
- Get inspections done and make sure everything is to your liking…check.
- Get the final HUD statement 3 days before closing…WOAH.
“WHY DOES MY CERTIFIED CHECK (don’t bring your personal check to closing…it won’t work) HAVE TO BE FOR THAT AMOUNT? I thought my down-payment was only 10%? I know I’m not good at math but where did this number come from?”
Well friend, it’s time to make yourself aquainted with the dreaded word…
inspection…I mean appraisal…I mean closing costs.
That’s a pretty long list of items that can fall under closing costs, but it isn’t always limited to these things! Pretty much anything can be negotiated in real estate, and they just might end up wrapped up in closing costs!
Like the graphic says, the costs will vary depending on the location and type of loan as well, so it’s not going to be the same for every person. However, a good rule of thumb is to account for around 3% of the sales price. If you like to live on the edge, assume 2%. If you want to be extra-careful, go for 4%. Whatever floats your boat.
Buying a home can be tricky with all of these sneaky little things, but don’t stress – we’re here to help you! And don’t be afraid to ask questions along the way – it’s your money and you deserve to be well-informed for the entire process!