How much money will I need to buy that $200,000 home in Dallas?
Bottom line please! There are three categories of monies out of your pocket that you will pay for at closing. Those categories are:
1. Down-payment for a conventional loan is 5%, which is $10,000.
The down-payment could be anywhere between 0-25% of the sales price. The down-payment will be decided on how much money you have or do not have or what loan program you qualify for.
2. Closing Costs are generally around 2%, which is $4,000
The closing costs could be 0-5% of the sales price and are divided into two subsets. Those subsets are loan originating costs and third party fees. Loan originating costs are points, processing fee, administration fee, and/ or origination fee. Third party fees include home inspection, title insurance, appraisal fee, and/ or attorney fees. This is not a comprehensive list of closing costs and will vary between lenders and states.
3. Taxes are $1,251 and insurance is $333.
Property taxes are assessed by your county, city, community college, and school district. If you escrow, your lender will collect 3-7 months depending on what month of the year you close. In Dallas, the property taxes are around 2.5% of sales price or $5,000 for a $200,000 home. $5000 divided by 12 equals $417. If three months are collected it would be $1,251.
The homeowners insurance policy will protect your home in case of a fire or other hazards. The hazard insurance policy could be .5-1.5% of the sales price. Assuming 1%, the insurance would be $2,000. At closing you must prepay one year. If you escrow, the lender will usually collect 2 months. The two months is calculated at $2,000 divided by 12 then multiplied by 2 which equals $333 approximately.
How much money will I need to buy that $200,000 home in Dallas? Bottom-line please! You would need approximately $15,584 for a home in Dallas County in Texas.
The intent of this post is to answer a basic question that most would be home buyers have by applying general estimates of all costs associated with a home purchase. The scenario above is for informational purposes only and there may be loan options with much less or much more costs than estimated above. For a more comprehensive explanation of settlement costs please click on link below or paste the URL in your web browser bar:
If you are buying a home seek a licensed residential mortgage loan originator who you trust will review your complete financial situation and take the time to explain your settlement costs.
In Texas, contact Jimmy Smith for questions or a no obligation loan consultation.
Jimmy Smith, NMLS#1089067
firstname.lastname@example.org, (214) 872-9091 Ofc