If you are planning to buy real estate property, then you will pay for more than just the listing price. Most things have a hidden cost. When you are looking for homes for sale, it helps to be aware of the fees associated with buying a house.
The closing is one of the final steps in competing a real estate transaction. It a list of charges buyers must pay before taking ownership of a property. These charges include document copying fees, homeowners insurance, and property tax reserves.
It is hard enough coming up with a down payment as a first-time buyer. Read on to find out how to get help with closing fees.
Ask for a GFE
Home buyers typically pay around two to five percent of the purchase of their home in closing fees. The average buyer pays around $3,700. Your lender should give you a good faith estimate. A good faith estimate (GFE) is an estimate of closing costs on a home selected by you.
You can get a settlement statement on the day before closing. The settlement statement is complete listing of fees associated with the purchase of your home. If your lender does not give you a GFE, then you should ask for one.
Find a Loyalty Program
Many banks offer help with closing when the buyer finance the purchase through them. If you join your bank's loyalty program and become a preferred member, then the bank will reduce your origination fees.
An origination fee is an up-front charge by your lender for processing a new mortgage. It is a percentage of your total loan, which is between 0.5 and one percent. Loyalty programs help because they decrease your overall total amount.
Close at the End of the Month
You can reduce fees by closing at the end of the month. If you close at the beginning of the month, then you must pay for a complete month of taxes, interest, and HOA fees. Closing at the end of the month means paying a pro-rated portion of these fees.
Most people want to achieve financial freedom. A step in this direction is with home ownership. After you pay off your mortgage, you will own the property and not have to make any more payments. There are many benefits to owning a house. You should not let something like closing fees stop you from accomplishing your goal. Check out http://www.foxfirerealty.com for more tips.