As a real estate consultant in Metro Atlanta, my job is to ensure that my clients are armed with as much information as possible in order to make an informed decision when purchasing a new home. I want my first-time home buyers to be 100% comfortable with their decision today... and in the years to come.
The most important question for a new home buyer is usually "How much will this cost?"
This may vary from state-to-state, but here is the breakdown for Georgia home buyers:
1) Earnest Money.............Typically 1% of the purchase price
** Due when you submit your offer on a home. The earnest money will be credited towards your downpayment or closing costs at closing.
2) HOME INSPECTION...................................$375 - $500
3) HOME APPRAISAL........................................$300 - $400
4) LOAN APPLICATION FEE / CREDIT CHECK..................... Varies by Lender
5) TERMITE INSPECTION (optional, but recommended)....... $45 - $75
6) PROPERTY SURVEY (optional, but highly recommended)....$400 - $500
6) LOW-FLOW PLUMBING CERTIFICATE (unincorportated Dekalb County).... $75
*** TOTAL (ESTIMATED) COST FOR A $300,000 HOME --> $4,200 ***
Once the home has been inspected, appraised and approved by the lender, there are costs AT CLOSING.
CLOSING COSTS fall into two fee categories -- Closing Costs and Prepaid Items
1) CLOSING COSTS include the loan origination fee (usually 1% of the purchase price), title examination, title insurance, courier fees, transfer tax, intangibles tax and a few other miscellaneous fees.
2) PREPAID FEES include costs to set up your escrow account with the lender and include homeowners insurance, property taxes, and homeowners association dues (if any). Usually your new lender will want 2 - 6 months of reserves in the escrow account, just in case you do not pay your mortgage, they will still be able to insure the home and pay the property taxes.
Typically, the closing costs and prepaid items add up to 2 - 4% of the purchase price (on FHA loans, the cost is about 3.5 to 5% of the purchase price). Using the $300,000 example above, the closing costs would be $6,000 to $12,000. It just depends on how much you are financing, if you pay for discount points (to decrease your interest rate), etc. For an accurate breakdown of your closing costs, ask your loan officer or mortgage broker for a "Good Faith Estimate."
THE GOOD NEWS -- When you negotiate your offer on the home, you can also ask that the seller pay a portion of the closing costs and pre-paid items.
If you have any questions about the home-buying process, please don't hestitate to call me at 404.432.1844 or visit my website at http://www.ATLhomesearch.com
All the best,
Kerry Lucasse
Real Estate Consultant, Keller Williams Realty
404.432.1844
Comments(8)