If I purchase a house or condo in LA, how many different transaction costs should I pay?

Asked by michael, Los Angeles, CA Thu Jun 27, 2013

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Jamie Tian, Agent, Los Angeles, CA
Thu Jun 27, 2013
Hi Michael,

The amount of transaction costs will depend on the cost of the property you purchase and also whether or not you get a loan.

You should speak with a lender/loan officer to get prepapproved if you haven't already and get a better idea of how much buying power you have. I would be happy to recommend a few options to you if you would like.

Please feel free to contact me directly at (310) 717-1321 or JamieTian@RodeoRE.com with any questions/details regarding your situation and we can discuss further.

Best,

Jamie Tian
Rodeo Realty
(310) 717-1321
JamieTian@RodeoRE.com
DRE #01920120
1 vote
V Kumar, Agent, Pasadena, CA
Mon Jul 1, 2013
Hello Michael,

You'll need cash for various "closing costs," and for a down payment (20% is standard, unless you qualify for an FHA-backed loan). Closing costs typically include not only the transaction costs but homeowners' insurance, mortgage insurance, your share of that year's property taxes, and more. The total is usually around 2%-3% of the house price, depending on what state you live in, what kind of mortgage you get, and more -- see http://www.bankrate.com for a state-by-state analysis of the loan portion of buyers' closing costs

Buying a house involves a lot of upfront effort, and you won't want to have to do it again in a year or two. Buying a house also involves expensive "transaction costs" like loan setup fees, property inspections, and more -- sometimes in the thousands of dollars. And if you need to move during a market slump, you could have to sell for less than you purchased for -- plus pay commissions to the real estate agents (averaging 5-6% of the house purchase price, or $5,000 for every $100,000).

When picking a mortgage, you usually have the option of paying additional points -- a portion of the interest that you pay at closing -- in exchange for a lower interest rate. If you stay in the house for a long time -- say three to five years or more -- it's usually a better deal to take the points. The lower interest rate will save you more in the long run.

Getting pre-approved will you save yourself the grief of looking at houses you can't afford and put you in a better position to make a serious offer when you do find the right house. Not to be confused with pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history.


Vinu Kumar
Coldwell Banker Residential Brokerage
Work: 800.846.1619
Mobile: 949.887.2567
Fax: 626.628.1956
Email: emailvinukumar@gmail.com

http://www.linkedin.com/in/vinukumar1
0 votes
Dorene Slavi…, Agent, Torrance, CA
Thu Jun 27, 2013
Dear Michael,
I'm not sure what you mean by "transaction costs". There are buyer closing costs, and there is a transaction fee that is imposed by some large brokerages. If you are concerned, it's best to speak directly with your Buyer Agent to clarify what you are being charged. There are systems in place to protect the consumer .
RESPA requires detailed broker and lender good faith estimates regarding settlement and closing costs to be provided within three days after you apply for a loan. RESPA also requires a HUD Uniform Settlement Statement that provides you with a detailed accounting of actual disbursements and closing costs upon the completion of your loan transaction so you will be well informed.
0 votes
Heather Paul, Agent, Santa Monica, CA
Thu Jun 27, 2013
You are going to want to pay for inspections, appraisal if you are getting a loan, escrow and title fees, and a few others. Feel free to call me directly and we can go over the whole process together.

I look forward to speaking with you,
Heather Paul, Broker Associate, Realtor
Coldwell Banker
310-923-2334
http://www.HeatherPaulOnline.com
0 votes
carlos parra…, Other Pro, Monrovia, CA
Thu Jun 27, 2013
There are many variables. Are you getting a loan? or paying cash?
There are more fees to pay with a Loan.
The amount of the fees will also vary. different companies charge different fees.
0 votes
Susan Bo'ur, Agent, Manhattan Beach, CA
Thu Jun 27, 2013
Good morning Michael,
Please contact me directly to discuss.
Susan@SusanBour.com
0 votes
Javier Menes…, Mortgage Broker Or Lender, Melville, NY
Thu Jun 27, 2013
Michael I would consider speaking to a Loan Officer as obtaining a Good Faith Estimate. This will give you as close a breakdown of the numbers involved in your purchase, as they will be the day of the closing.

Generally speaking, you have lender related costs, title related expenses and prepaid items if you'll be escrowing. Speak to a Loan Officer, it's your best bet.

If my response was helpful, consider clicking BEST ANSWER!

Javier Meneses
Senior Loan Officer
NMLS #23130
STERLING NATIONAL BANK
310 Crossways Park Drive
Woodbury, NY 11797
jmeneses@snb.com
(516) 606-9648 Cell
(631) 659-2011 Office
(516) 918-5383 Fax
0 votes
Muriel Levin, Agent, Beverly Hills, CA
Thu Jun 27, 2013
Hi MIchael,
Hello again, it seems that you need to talk to an agent to help you out. Did you mean how much will you pay in closing fees ?
the escrow company should be able to give you a list of these as soon as you have an accepted offer. Make sure to ask for it as soon as you know who is the escrow officer that can write you a buyer estimated costs. The costs will vary according to the property you will buy. You may be asking : what percentage of the purchase price will the closing costs be?
Hope this is helpful to you.

Muriel Levin, Broker - Realtor
HAFA certified,Certified Negotiator, Short Sale and Foreclosure Resources Specialist. Residence, income properties and commercial leases.
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323 363-91-40
Muriel Levin @ gmail.com
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