The costs vary depending on a number of variables. As an example, fees change based on the price of the home, the amount of the purchase being financed and the type of home. In addition, the costs will be different to you as the buyer if you purchase and REO or short sale instead of a â€œnormalâ€ sale.
Buyer fees typically include:
* Loan origination points
* Pepaid interest
* Property tax impounds
* Insurance impounds
* Processing/Underwriting fees
* Document prep fees
* Appraisal fees
* Funding fees
* Tax service, flood cert, etc.
* Escrow fee
* Ownerâ€™s title policy
* Lenderâ€™s title policy
* Doc prep, notary, recoding, courier, etc.
* Prorated property taxes
* Homeownerâ€™s dues (if applicable)
* Transfer tax (if not paid by the seller)
* Annual homeownerâ€™s insurance policy (if applicable)
* HOA transfer fee
If youâ€™d like a comprehensive net sheet with actual costs, email me the details of your potential transaction and I will send you a detailed net sheet. I live in Newark, so I understand the local market and all applicable fees.
First of all, you should know that closing costs are negotiable where we are. Some of my buyers have had their closing costs paid by the Seller.
And some lenders advise their clients to raise their offer just a bit to cover their closing costs, and ask the seller to "credit" the buyer for those closing costs.
As a general rule, we normally think of closing costs as being between 2-3% of sales price.
And a a buyer, you don't pay the realtor's fees. That expense is shouldered by the seller.
Typically, here are some closing costs for your info. I cannot stress this often enough: they are negotiable between buyer and seller
* County transfer tax -- in Alameda County, seller normally pays
* City transfer tax - in Newark, this is not applicable
*14 months of insurance
* 4 months of taxes
* so many days of interest
* Appraisale - typically paid by Buyer
* Loan application fee
* Courier fees/digital loan documentation fees
* Loan processing/funding fee
* Title policy
* Lender's title policy
* IF APPLICABLE - loan origination fee (some lenders may waive this)
* Lender's inspection fee
* Flood certification
* Recording fees
* Escrow fees
By the way, if you're a first time buyer, don't forget to see if you qualify for buyer assistance
If you need additional info, don't hesitate to contact me.
I would like to refer you to my website listed below. Upon visiting it, click on "I'm a Buyer" and you will see a comprehensive list of articles and information, including the Home Buying Process. Upon reviewing this information, if you still have questions, please feel free to contact us and we will put you in touch with one of our Buyer's Agent Specialists to answer any further questions you may have.
You should know by now that realtor commissions are not set in stone. If the property Melanie decides to buy is a a short sale, the lender sets the commission.
Also, when a property is listed for sale, the list price is based on what the market will bear and what the market comps are like, and are not based on realtor commissions.
I don't know that this is the forum to discuss what realtors do for their clients to earn their commission...but do you work for free when you provide a service? What's your time worth?
The buyer doesn't "lose". There is comfort and peace of mind in knowing that her agent will negotiate and work on her behalf:
** like try to get the seller to pay for buyer's closing costs
** lower the sales price
** perform repairs and replacements)
** and that the purchase is done correctly and legally, with minimized risk to the buyer since realtors protect themselves and their clients in many ways (errors and ommissions insurance, disclosures, etc
** provide resources for lenders, inspectors, contractors, title companies, etc.
** arrange and meet with the inspectors and appraiser
** collect all documentation and disclosures, and review these with the buyer so that buyer understands and is apprised of the condition, etc. of the property
** monitor the timelines so that the buyer and seller meet deadlines so that neither is compromised
These are just a few of the things realtors do for their buyer...and this is just the half of it. Realtors don't get paid until and unless escrow closes. If the deal doesn't go through, we are not reimbursed for time and expenses.
So...what's your time worth? Will you work for free?
Besides the closing costs and prepaids (you can get a good faith estimate from your lender) remember that you will need to have money handy before closing for the earnest money depost (our area is usually $500 - $1,500), money for the home inspection ($225 - $500) and money to pay the lender for the appraisal ($400ish) if they require upfront payment. Sometimes, depending on negotiations, you can get this money back, but be prepared to have it up front. Don't skip your home inspection because you don't have the $$ saved.
This powerpoint-like presentation did a fair job giving me an idea of what to expect on closing costs: