Home Buying Expenses
There are several expenses in the home buying process beyond just the price of the property. Here are average expenses you can expect to encounter on a $300,000 purchase.
Not Due Until Signing and NON-REFUNDABLE
Heating oil reimbursement:
If the home runs on oil, you will pay market price for the oil left in the tank.
Mortgage and escrow costs:
You should receive an estimate of these costs from your lender.
Closing costs (loan costs, escrow, and title fees) = $1500 - $5000
Prepaid expenses for interest, taxes, insurance and reserve account for taxes and insurance = $1500 - $5000 (varies greatly depending on the property taxes and your selected insurance policy)
Your Down Payment amount is completely dependent on your loan program. Usually a Down Payment will be between 3% - 20% of the purchase price. Your earnest money will be applied as a credit towards your Down Payment at closing.
Due at the time you write the offer, but REFUNDABLE if you back out of the contract based on valid contingencies:
Earnest Money: 1- 5% of sales price. Earnest Money converts to your Down Payment at closing.
Due Before Closing and NON-REFUNDABLE, whether or not you purchase the home.
Home Inspection = $450 - $600
Underground Tank Locate = $99
Soil Testing (if an underground tank is known to be present) = $175 - $250
Sewer Inspection = $100
Radon Inspection = $150 - $200
Lead Based Paint Inspection = $250 - $500
We generally advise buyers to have about $1000 on hand for an average round of inspections.
There’s always the possibility that a buyer may want to do additional inspections such as a structural inspection, HVAC inspection, etc. based on the home inspector’s recommendations.
Appraisal Fee: $450-$600. The lender will usually collect this money up front and it is non-refundable after the appraisal has been completed.