19 May The Real Costs of Buying a New Home
When you are just entering into the home buying process, particularly as a first-time homebuyer, the realities of such a large purchase are very often under estimated. Sure, you know that buying a home costs hundreds of thousands of dollars and that a large percentage of that must be a down payment.
However, outside of that down payment and your monthly mortgage for the coming years, there are several other taxes, fees, and expenses connected to buying a new home. Proper planning means making sure you have the cash or the credit to sustain these costs as well, which means knowing what they are and whom to ask in regards to your particular situation. Common fees include:
- State Taxes, Duties, and Fees
Mortgage registration, stamp duty, mortgage stamp duty, and registration fees, just to name a few—each state has a different set of requirements and laws regarding taxes and fees. Make sure to check with yours.
- Lender Fees
Like states, each institution has a different set of standards, but common fees include: application fee, establishment fee, service fees, bank legal fees, and transaction fees.
- Legal Fees
If you engage the service of a solicitor or conveyancer, you must pay their fees as well. These range widely depending upon the State of sale and property value.
- Inspection Reports
Building inspections as well as pest/termite inspections are highly recommended and may be part of the loan approval process required by the bank.
When buying a new home, it is important to plan and save for every expense that you will incur from minor fees to major taxes. As a responsible buyer, getting these ducks in a row is essential, but also time consuming. If you need some help getting your head on straight in this regard, take a look at our FREE Home Loan Starter Kit. This 14-page guide provides you will all the basics from home loan types to fee breakdowns and even provides a handy checklist to keep it all straight. If you have further questions, a mortgage broker is the perfect person to ask, and we’d be happy to assist you.