Buying a new house is one of the highest investments, followed by a full spectrum of fees. Not only will you have to pay for the property, but also a multitude of other fees, such as inspection, moving services, and insurance. If you’re planning to begin a house buying process, check out some of the main costs that you’ll need to include in your budget.
When buying a property, a down payment is among the first big expenditures to prepare for. Calculate for a minimum of 3% of the purchase price to put towards your down payment. Ideally, you’ll offer a 20% down payment, which will later come in handy because you can cut the cost of private mortgage insurance. Before you get your mortgage approved, you’ll need to get your credit score to a lender, which can cost up to $50.
The property itself
The following fee to look out for when buying a house is the rest of your home’s value. Make sure you check the contract thoroughly and avoid paying for more than you agreed upon with the seller. Always check the fine print to avoid overpaying the property. Once you’ve bought a house, you’ll start paying off the mortgage. In itself, it will be a long-term cost that you’ll need to calculate into your budget if you want to ensure enough money for basic needs in the first few months of buying a new house.
Did you know that many people don’t even consider paying for home insurance? Not having an insured home can cost you a fortune if something were to happen, to your home due to a robbery or a natural disaster. So, when you begin the process of buying a house, calculate the costs of insurance into the budget too. However, don’t forget to read all the clauses, or better yet, have an attorney do it for you, so you avoid overpaying for junk insurance and similar unnecessary fees. Now you’re probably reading this and wondering what is junk insurance really? Junk insurance is all those costs that an insurance company will make you believe you need to pay, but will turn out to be useless.
Buying a house is always more practical and secure with the help of a realtor. They know the neighbourhoods well and will be able to inform you about all the details regarding the nearest shops, schools, events and anything you’d like to know about the area you’re moving to. So, include the realtor’s fee into our budget to ensure a safe move with no surprises.
Investing in a new property shouldn’t be taken lightly. You’re investing your money and effort into a real estate that will be your home for the next several years, or the rest of your life. You need to be 100% sure that you’re buying a home with no defects and excellent construction. Hiring professionals to inspect the foundation, walls, electrics, water installations, doors, and windows is vital. The last thing you need is to find out your house is filled with termites only a few days after moving in. Avoid paying a fortune just because you forgot to hire home inspectors to estimate the condition of the house for much less money.
How do you plan to move your furniture? Do you have enough vehicles and people to help you relocate all your belongings? Even if you do, hiring professionals to pack, load and unload everything into your new home is a much better option. You will pay a fee, but you’ll know that your furniture is in safe hands from start to finish. Find a moving company near you that will relocate your furniture wherever you need it and ensure peace of mind.
After you’ve had inspectors look through the house and estimate its condition, they’ll likely find minor updates that need to be done after you move in. Changing lighting fixtures and relocating a sink in the bathroom or the one in the kitchen probably won’t affect your decision to buy your dream home. Shrubs in the backyard that you don’t want will be history once you have a gardener remove them. Those are some of the after-purchase costs that you should also keep in mind when investing in a new property that won’t break the bank but will make a big difference.
If you think you’ve saved up enough for your new home, calculate all the fees again. Don’t forget to think about all those low costs that eventually add up and risk you breaking the bank. Keep the list of fees that we’ve put together in mind when you begin your home buying process to avoid spending more money than you can really afford.