If you’re buying a home, you know it comes with a price tag – and the total cost is a bit more than what you list in your purchase offer. That’s because there are some fees associated with buying a home.
Here’s what they are.
10 Fees Associated With Buying a Home for Sale in Orlando
When you buy a house in Orlando or anywhere else, you’re going to encounter some costs. Some of them, like your earnest money deposit, you’ll get back; others are simply part of the cost of buying a home.
#1. Earnest Money
An earnest money deposit is money you give the seller to show that you’re serious about buying his or her home. (You don’t actually give it to the seller; you give it to your agent, who puts it in escrow.) After you close the deal, your earnest money deposit goes toward your closing costs, your first mortgage payment or your down payment.
#2. Down Payment
You’ll have to come up with a down payment to buy a home. For most people, the down payment is between 5 and 25 percent of the home’s total purchase price. The higher your down payment is, the lower your monthly mortgage payments will be.
#3. Homeowners Insurance
Your lender will require you to buy homeowners insurance. That way, if something happens to the house, your lender won’t lose its investment (and neither will you).
#4. Property Taxes
Everyone has to pay property taxes, which vary by location. The taxes typically go toward public services, such as police, fire and EMS, roads, sewage systems, and schools.
#5. Private Mortgage Insurance
Not everyone has to pay for private mortgage insurance. However, if you put down less than 20 percent of the home’s purchase price as a down payment, your lender will most likely require you to buy it. This insurance protects your lender if you default (fail to pay) your mortgage payments.
#6. Appraisal Fee
You’ll have to pay a professional appraiser to value the home you want to buy before the bank will give you the money. You can’t choose the appraiser or shop for the best rates; the lender chooses an appraiser it trusts for the job.
#7. Loan Origination Fees
Your lender will charge you loan origination fees to generate and process your loan. The lender will let you know how much the fees will be, and they may even be negotiable (so it doesn’t hurt to ask).
#8. Title Search Fees
You’ll have to pay an attorney or title company to make sure that the seller who’s selling you the home is its legal owner. The title search will also show if there are other problems with the title that could later affect your ownership of the home, such as liens.
#9. Home Inspection
Smart buyers have a home inspection before they lay down any cash to buy a house. The inspection will show you what issues the home has so you can use them to negotiate with the seller – or, at the very least, know exactly what you’re getting into.
#10. Closing Costs
You’ll have to pay closing costs when you actually close the deal on the home. These typically range between 2 and 5 percent of the home’s total purchase price.
Are You Buying a Home in Orlando?
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Explore our:
- Homes for sale at Alaqua Country Club
- Bay Hill Club homes for sale
- Houses for sale at the Country Club of Orlando
- Keene’s Pointe Golf Club homes
- Homes for sale at Isleworth Country Club
- Real estate listings in Sweetwater Golf and Country Club
- Homes for sale at Heathrow and Legacy Clubs
