As you move forward with a major financial and lifestyle decision, you want to be sure you’re prepared. Saving enough money to buy a home takes planning, but the offer you submit for the home isn’t the only cost you’ll have to consider. There are other common costs associated with buying a home, and if you’re not aware of them, they can sneak up on you. The last thing you want is for your momentous day to end on a sour note because you weren’t anticipating all of the financial considerations that go into buying a home. In today’s blog, we touch on some of the common home buying costs.
Don’t Let Closing Costs Catch You Off Guard
The biggest additional cost to a home purchase that many first-time buyers often miss, is the closing costs. Closing costs include any number of itemized fees associated with securing your loan and purchasing your home. You can expect closing costs to range somewhere between 2-5% of the cost of the home. Closing costs often include an appraisal fee, survey fee, wire transfer fee, underwriting fees, recording fees, and title insurance. The good news is, some of these fees are negotiable, so knowing about them ahead of time can give you a leg up in the process.
A Smaller Down Payment Requires Private Mortgage Insurance
You should also be aware that making a down payment of less than 20% of the home’s total cost will necessitate private mortgage insurance. By no means do you need a full 20% down payment to move forward with a home purchase, but you should anticipate this extra insurance cost. Making a smaller down payment allows many buyers to close on their first home when they wouldn’t otherwise be able to do so. It’s always best to be informed about these costs ahead of time.
Real Estate Agent Commissions Are Paid by the Seller
If you’re working with a real estate agent, you may also be concerned about the cost of commission. As a home buyer, you don’t need to worry about this cost. Your real estate agent and the seller’s real estate agent will typically split the commission, and this commission comes from the seller, so it’s incorporated into the cost of the home. It’s a good idea to lean on your buyer’s agent for estimations of property taxes in the area and estimated utility costs, as these are additional considerations that need to be made.
Looking for a Home in Omaha? Work with Bill Swanson
If you’re on the hunt for the perfect home in Omaha, talk to Bill Swanson! Bill is an Omaha native with 30 years of experience in the real estate industry. Bill can help you find the ideal home in the right neighborhood for you. To start your home search with Bill Swanson, contact his Omaha, NE office at 402-679-6566.
Buying or Selling a Home in Omaha? Call Bill Swanson Today!
As a long-time resident of Omaha, I know the area and the surrounding communities intimately, and can give you access to information that you could never find online. If you want to know more about the community, are looking to buy a home in a new one, or need the help of an agent to sell your home quickly, conveniently, and successfully, then email [email protected], or call (402) 679-6566.