Homebuyer Help: What are the typical expenses incurred by a homebuyer?

What are the typical expenses incurred by a homebuyer?

Bank expenses fees including, but not limited to, processing fees, application/appraisal fees, credit reports, tax service fees, document preparation fees. These equal about $1,100.00 in a typical transaction.

Above and beyond that, there may be points if the buyer chooses to buy down their mortgage rate. There are usually no point options on most programs except State Bond programs. A point equals 1% of the mortgage loan amount.

A Buyer typically pays a title search fee that is approximately $175.00. Title Insurance costs approximately $4.00 per $1,000.00 of coverage.

Attorney's fees for representing a bank are typically in the $500.00 to $750.00 range.

Recording fees are typically less than $250.00.

In addition, most banks require that there be an escrow for taxes and insurance and this typically can be as much as 5-7 months' worth of taxes, depending on when the transaction occurs. In addition to the tax escrow, the Buyer reimburses the Seller for the taxes prepaid by the Seller. It generally works out that between the tax reserve and the amount reimbursable to the Seller, that a Buyer pays 7 months of taxes at time of closing.

The buyer will also have pick up the per diem interest charge based on the closing date. This varies by loan amount, interest rate and closing date. Closing month's end reduces this fee.

The Buyer also reimburses the Seller at closing for fuel oil, and most fuel oil tanks are 275 gallons. The tank is usually topped off at time of closing and the Buyer reimburses the Seller for a full tank of oil.

Last, but not least, the Buyer may have to pay for mortgage insurance and the amount of the mortgage insurance varies.