What Are Closing Costs for the Homebuyer?
Call Ashley Kimble Slaughter at 225-235-9379 for any questions related to closing costs or the home buying process. You don’t have to go through the home buying process alone. Ashley Kimble Slaughter has the knowledge and experience to help make this process as smooth as possible. Visit AshleyKimble.net to see featured homes for sale in Baton Rouge, LA.
When considering the amount of money you’re going to need when purchasing a home, don’t forget to figure in the added financial adjustment for closing costs. Many people confuse the down payment for the closing costs, but they are two different things. Closing costs can be 2% - 5% of the price for the home. So, what are the closing costs for the homebuyer? Here’s a list of examples of items that may be included in closing costs.
Fees for Escrow Services
The earnest money that a homebuyer provides for the purchase of the home is held by an escrow company. The escrow officer ensures that all paperwork and funds are handled properly. The escrow company is an impartial party in the home buying process. The escrow fees will be paid to this company.
Titles & Homeowners Insurance Costs
A policy for homeowner’s insurance is required when you purchase a home. This is an important part of the closing costs. You may be required to pay the annual fee for this insurance up front as part of closing costs.
A title search will be completed to make sure that there are no liens, unpaid bills, or third-party claims on the property. A fee will be charged for this service. There may be a title insurance fee that offers protection to the buyer for the results of the title search.
Legal Representation and Administrative Fees
An attorney is usually present at the closing and there are attorney fees associated with this part of the process. There number of attorneys present depends on the desires of the buyer and seller. An attorney may be present for both parties or each party may choose to have their own representation at the closing. The fees associated will depend upon these factors.
There may be fees associated with the administrative part of the real estate transaction. These fees will be added to the closing costs. Fees may include notary use, stamps, filings, taxes, and fees associated with paperwork that is needed to change the ownership of the home.
Property Taxes and Lender Costs
Depending on when the home is purchased, the taxes may have been paid on the home at the time of closing. The buyer may be required to pay a portion of the taxes that have already been paid by the seller. A lender may require that a portion of the taxes be paid up front if they haven’t already been paid. Check with the lender to see what their expectations are when it comes to this part of the closing costs.
Inspections may be required to determine if there are insect or structural problems. The property may need to be surveyed to ensure that the size and property lines are represented correctly. There will be fees associated with each of these procedures.
The final step in buying your home is the closing process. The fees and costs associated with the closing are needed, but they shouldn’t catch you by surprise or cause additional stress. The settlement form will include a good faith estimate that should list all the closing costs ahead of time. This will help you plan ahead and budget for the added costs.
Having a knowledgeable real estate professional on your side during this process is valuable. They’ve gone through this process many times and know exactly what to expect. They can guide you and help you prepare ahead. Your real estate agent will be available to answer any questions and handle the details of paperwork so that you can focus on the excitement of buying your new home.
Keep in mind that closing costs are sometimes negotiable and can be paid by the buyer and the seller, depending on their agreement. Talk to your real estate agent about the specifics of negotiating closing costs when you’re considering the purchase of a home.
Call Ashley Kimble Slaughter at 225-235-9379 for any questions related to closing costs or the home buying process. You don’t have to go through the home buying process alone. Ashley Kimble Slaughter has the knowledge and experience to help make this process as smooth as possible.