Buying Your First Home? Know About These Home-Related Fees

A home buying process is interesting, especially when it is your first home. People always check their budget and financing options. However, they forget to do a study on the various fees they need to pay. Some fees require immediate payment while others get covered in the home loan. As a first home buyer, you need to understand the various fees and plan finances accordingly.

Here’s a list of fees that you need to pay while buying a home in MA.

1)     Home Inspection Fee

Home inspection is an overall check of the property’s condition. Many buyers don’t find this inspection necessary. We recommend you opt for this because the fee is minimal and benefits are more. A licensed home inspector can check all the ins and outs of your future home. This inspection helps to know the hidden problem that might require heavy expenses on repair. Some lenders make home inspection mandatory for loan.

2)    Appraisal Fee

The lenders give money either by appraised market value percentage or by home’s purchase price. In both cases, the appraisal fee is often given by the borrower to the lender. It is a good sum of amount that can impact your budget mildly. Some lenders might charge a financing fees as per your credit score. Be ready for it.

3)   Deposit Fee

When it comes to home buying, it works both ways. Seller always ask for some security deposit as a token of the deal.  This is a good way to assure that the buyer is genuinely interested in the home purchase. In case they don’t turn up after the decided time period, all the deposited amount goes to the seller.

4)   Mortgage Insurance

Generally, a high ratio mortgage (with less than 20 percent down payment) includes a default Mortgage Insurance for the lender’s security. In case the home buyer does not pay the amount, lenders do not incur the loss. Home buyers need to pay the mortgage insurance costs apart from monthly premiums. You can also club these both in some cases. The first time home buyer programs in MA by Drew Mortgage provides multiple options to choose a suitable mortgage loan plan.

5)  Property Taxes

You might already be aware of property taxes. It is a fee paid by the property owner to the government body of the area. Normally, it is an annual payment. You need to check if the seller has completed the previous dues. Pay these fees on time to avoid unwanted property issues.

6)  Legal Fees

Home buying process becomes a breeze with the help of real estate experts/lawyers. They make your major legal work easy. Drafting an error-free mortgage contract is one of the most important works they do. A lawyer from the buyer’s side does more paperwork. They verify all the home-related documents to ensure the safe purchase of the property. For all these services, they charge. Keep a good amount ready for the key person of your home buying purchase.

Always remember, these all are the most common fees that you will need to pay while buying a new home. These fees can differ from state to state. Make sure you discuss all the possible fees during and after the home buying process. Also, check who needs to pay it. Some fees need to be paid by the seller and some by the home buyer, check it carefully.

At Drew Mortgage, we can help you with complete financial planning & loans. Feel free to talk to us, we will present the best possible plans for you.