In this series of posts, we will be uncovering some of the major hidden costs associated with home ownership. Many first-time buyers are only focusing on the down payment and their prospective mortgage payment, but these lesser known fees can add up, making a serious dent in your budget. As we explore the five most common unexpected expenses, be sure to protect your home with a NJ Homeowners’ Insurance policy.
If you’re purchasing an older home, this cost should be factored into your offer. Hiring a professional home inspector can prevent you from getting a lemon. Inspectors will look for signs of structural issues, mold, and leaks; assess the condition of the roof, gutters, water heater, heating and cooling system; and more. Inspections cost between $300 and $500, and whether or not you end up purchasing the property, you still need to pay this fee, states House Logic. However, if you suspect foundation damage or pests, you’ll need to call in a specialist.
This evaluation will give the bank a fair market estimate of the house you wish to purchase. If the appraisal comes back for less than your offer, the sellers will have to adjust their price. This fee costs anywhere from $200-$425.
These fees cover all of the administrative and miscellaneous costs of searching the title of your home, researching property records, notary fees, government filing fees, and more.
Lender origination fees.
Your lender will charge you this upfront fee for making the mortgage loan. This includes processing the loan application, underwriting the loan (researching whether to approve you), and funding the loan. These fees are quoted as a percentage of the total loan you’re taking out and generally range between 0.5 to 1.5%, explains the article.
Private mortgage insurance.
If you don’t have at least 20% to put down on your home, this insurance policy will be required by the lender to ensure they don’t lose money should you end up foreclosing on the property. These loans cost anywhere from 0.3% to 1.5% of your total loan amount.
About Tri-State Insurance Agency
At Tri-State Insurance Agency, we are committed to protecting homeowners against the broad spectrum of perils they face. Whether it is your full-time residence or vacation spot, our homeowner’s insurance is custom written to meet your specific needs and offers higher coverage limits and inclusions that traditional policies. For more information, contact us today at (973) 579-6776.