Saving for a down payment is a key step in the homebuying process however, it’s not the only monies you may need to include in your budget. Another factor that’s important to plan for is the closing costs and prepaid items required to obtain a mortgage. I cant tell you how many buyers contact us wanting to buy a $200,000 home putting down 5% and thinking they only need $10,000. There is more to this and getting the right details upfront makes a big difference.
What Are Closing Costs?
According to some experts – bla bla bla,
“When you close on a home, a number of fees will be collected. They typically range anywhere from 2% to 5% of the total cost of the home, and can include title insurance, Lender fees, Settlement fees, doc preparation fees, and more.”Experts further share
You will see lots of documents in front of you prior to closing and also on closing day. By closing you will not have enough time to read all the docs. We recommend that you work closely with your real estate agent, lender, and attorney, if you have one, to get all the documents you need ahead of time.
For closing the most important thing to read is the closing disclosure, which shows your loan terms, final closing costs, and any outstanding fees. You are required to acknowledge this form no later than 3 days three days before closing since, once you (the borrower) are required to sign it. If you have any questions about the numbers or what any of the mortgage terms mean, this is the time to ask—your lender and real estate agent are great resources for getting you all the answers you need.”
We are here to discuss the home buying process, to be sure your plan includes budgeting for what you need to purchase your dream home – without any surprises! We can even share a few secrets for how to do this with with less cash out of your pocket. Ask us about our Home Express Mortgage Plan.