Tuesday, November 23, 2021 / by Michelle Genolos
The Carter Team's Tuesday Tips: 13 Extra Costs to Be Aware of Before Buying a Home
Whether you're looking to buy your first home, or trading up to a larger one, there are many costs - on top of the purchase price - that you must figure into your calculation of affordability. These extra fees, such as taxes and other additional costs, could surprise you with an unwanted financial nightmare on closing† day if you're not informed and prepared. Some of these costs are one-time fixed payments, while others represent an ongoing monthly or yearly commitment. Not all of this costs†will apply in every situation, however, it's better to know about them ahead of time so you can budget properly. Remember, buying a home is a major milestone. Whether it's your first, second or tenth home, there are many important details to address, during the process. The last thing you need is unbudgeted financial obligations cropping up hours before you take possession of your new home. Read through the following checklist to make sure you're budgeting properly for your next move.
Legal Fees
Even the simplest of home purchases should have a lawyer involved to review all paperwork. Shop around, as rates vary greatly depending on the complexity of the issues and the experience of the lawyer.
Mortgage Loan Insurance Fee
Depending upon the equity in your home, some mortgages require mortgage loan insurance. This type of insurance†will cost you between 0.5% -3.5% of the total amount of the mortgage. Usually, payments are made monthly in addition to your mortgage†and tax payment.
Mortgage Brokers Fee
A mortgage broker is entitled to charge you a fee in order to source a lender and organize the financing. However, it pays to shop around because many mortgage†brokers will provide their services free to you by having the lending institution absorb the cost.
Moving Costs
The cost for a professional mover can cost you in the range of:
- $50-$100/hour for a van and 3 movers, and
- 10-20% higher during peak demand seasons.
Condos charge monthly fees for common area maintenance such as grounds keeping and carpet cleaning in hallways. Costs will vary depending on the building.
