Hidden Costs When Buying A Home

Hidden Costs When Buying A Home

As you embark on the exciting journey of purchasing your dream home, it’s important to be aware of the potential hidden costs that come along with the process. At the Lee Tessier Team, we understand that buying a home involves more than just the sale price. Here are a few hidden costs to keep in mind:

Home Inspection
While your dream home may appear perfect at first glance, it’s crucial to have a professional, certified home inspector evaluate the property before closing the deal. A comprehensive inspection can uncover any foundational defects in the walls, ceilings, flooring, windows, lighting, electrical, and water and plumbing systems. Although a home inspection will incur additional costs, it’s a worthwhile investment that can save you money in the long run. If any structural issues are discovered during the inspection, you can negotiate repair terms with the seller before finalizing the deal, rather than having to pay for repairs out of pocket after closing.

Appraisal Fees
If you plan to finance your home with a mortgage loan, you’ll need to account for a home appraisal in your budget. Your lender will hire a certified appraiser to evaluate the property value and condition of your new home. The appraiser will document the property’s valuable structural features and research the prices of comparable homes recently sold in your area. Your mortgage loan will then be issued based on the home’s appraised value.

Earnest Money Deposit
Another hidden cost of buying a home is the buyer’s earnest money or “good faith” deposit. This deposit demonstrates the buyer’s intention to abide by the sale agreement and ultimately purchase the home. The amount of your deposit typically depends on your contract and usually accounts for 1-3% of the home’s sale price. If you fail to meet specific deadlines outlined in your contract or walk away from the purchase, you’ll lose your deposit entirely. However, if your transaction processes successfully, you’ll receive your earnest money deposit back.

Closing Costs
Closing costs include upfront fees associated with the real estate transaction, such as appraisal fees, home inspection fees, escrow costs, loan origination fees, pest inspection fees, property taxes, title search and title insurance, and more. In addition to your down payment, plan to pay 2-5% of the home purchase price for closing costs.

Moving Costs
After the deal is complete and all parties have signed on the dotted line, you’ll need to consider the cost of moving. Packing supplies, professional movers, and moving trucks are just a few of the expenses to factor into your budget. By keeping these costs in mind, you can prepare for a smooth transition into your new home.

At the Lee Tessier Team, we believe in transparency and helping our clients navigate the home-buying process with ease. By being aware of these hidden costs, you can avoid any unexpected surprises and enjoy the excitement of finding your dream home.

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