If you are planning on buying a home, chances are, you have already saved—or are currently saving—for a down payment. But the down payment is not the only cost you will need to cover when buying a home—and if you want to have enough cash to successfully purchase your home, you will need to budget for those additional costs as well.
But outside of the down payment, what, exactly, are the additional costs you will need to cover when buying a home?
A recent video from realtor.com outlined the hidden costs of buying a home potential Buyers need to be aware of, including:
Closing costs. There are costs associated with processing your mortgage and closing your home purchase. These are called “closing costs”—and, on average, they can range anywhere between 3 and 5 percent of the purchase price.
Inspections. Buying a home is one of the biggest purchases you will ever make, so you want to know any potential problems the house might have. Inspections will help you get a better idea of the condition of your home—and they are a must if you want to avoid costly surprises in the future. Depending on the number of inspections you will need, plan to spend anywhere between $400 to a few thousand dollars.
Association fees. If you are moving into a home that is part of a homeowner’s or condominium association, you will typically have to pay association fees. Make sure you understand those fees before you buy the home—and that the fees fit in with your overall budget.
If you are thinking about buying a home let's connect. We can help you work through the thought process around all the expected and sometimes unexpected costs associated with homeownership.