Buying a home and completing the transaction process of a real estate deal comes with a number of costs. Some of these are borne by the seller, but the majority of them have to be paid by the buyer. Therefore, if you are going into a deal or simply making up your mind about buying your new house, California Over 55+
can give you the right idea about the total costs involved so that you can adjust your budget accordingly. Apart from down payment on your purchase
, a buyer also has to pay principal and interest on his own along with closing costs to be paid at the time the deal closes. Typically, the closing costs range between 2% and 5% of the total purchase price. For example, you will have to pay between $6,000 and $14,000 for a home that costs $300,000. As per a survey conducted recently, an average buyer pays approximately $3,700 in closing costs.
When a buyer is using a mortgage company to finance the purchase, the lender will issue a Good Faith Estimate (GFE) of the closing costs within 3 days of applying for the loan. Even though this will only be an estimate – since a lot of fees can change by up to 10% – it gives you a general idea of how much you stand to pay in closing costs. The lender also issues an HUD-1 settlement statement within 1 day of closing. The HUD-1 statement outlines the final closing costs you are required to pay. It should be noted that many of the fees outlined in the HUD-1 are negotiable, and your agent can help you bring them down or downright get rid of them, helping you save on closing costs.