Down
Payment
Most
lenders require at least 10% of the purchase price, though new
programs are available for 3%-5% down. 100% financing can be found,
but you credit must be excellent and PMI insurance will be required.
Loan
Origination Fee
A
lender's fee for establishing a new loan. Government regulations allow
only 1% origination fee on FHA or VA loans. Conventional loan fees can
vary from -1 to 3+ points, plus other costs. A point is 1% of the
loan.
Appraisal
Fee
Fee
paid to obtain an estimate of market value upon which the lender will
base the loan amount. The cost is about $300-$500. Non refundable.
Credit
Report
An
evaluation of the buyer's credit habits made by a credit bureau for
the lender. The cost is $50-$60. Non refundable.
Tax
Service Fee
A
charge of approximately $75 is made by a tax service company to verify
to the lender that the taxes have actually been paid when due or are
due to be paid by borrower or mortgage company if impounding.
Assumption
Fee
Fee
of approximately $250 up to 1% of the loan balance is charged by the
existing lender for the privilege of assuming the existing loan.
Pest
Inspection Fee
Fees
of $75 - $175 is charged by termite companies for inspecting property
for damage done by wood destroying organisms and dry rot. It is
customary for the seller to pay for Section 1 and the buyer for
Section 2 work.
Other
Inspection Fees
Other
inspections the buyer may choose to have done are: property
inspections that usually cover foundation, electrical, plumbing and
overall construction at a cost of $300-$400. Roof inspections cost
$75-$125. Geological reports cover subject's site in relation to fault
and slide zones, costing about $100. Septic $200-$400. Radon $50-$100.
Asbestos $75-$125.
Title
Insurance
This
is an extended policy with more specific coverage than the standard
policy. It covers unrecorded liens, is based on loan amount only and
is required by almost all lenders. The cost is obtained from a rate
chart and is based on the loan amount.
Miscellaneous
Costs & Fees
An
estimate of $150 should be adequate to cover minor items as notary,
recording documents, endorsements, etc. as well as allowing for
variations from these other estimates.
Hazard
Insurance Reserve
Two
month's premium is collected for the impound account if required. The
buyer will need to either provide or pay for coverage for the 1st
year.
Prepaid
Interest
Interest
must be paid from COE (close of escrow) to 30 days prior to the first
regular mortgage payment. An estimate of one months interest should
suffice.
Mortgage
Insurance
Mortgage
Insurance is required on all conventional loans greater than 80%. The
cost may range from 1/2% to 1% per year and 14 months premium is
collected in advance. This is coverage for the lender in case of
default.
Tax
Impounds
If
the new loan is going to have an impound account, the lender will
require from 2-10 months taxes to be deposited, depending on the time
of year. Note: if taxes are prorated, buyer's total charge for taxes
should equal about six month's taxes.
Escrow
Fee
These
fees range from $750-$2500, depending on the sales price. In some
counties its customarily paid by the seller, in other counties the
buyer pays, while in others it may be customarily split. Remember
though, everything is negotiable.
Negotiating
Fees
The
above fees are typical costs when buying real estate in Florida
counties. Most of the fees are considered buyer's non-recurring
closing costs. Some of the fees are fixed while others are negotiable.
Your real estate agent can negotiate with the sellers to pay some or
most of these costs, saving you thousands of dollars in closing costs.
Ask your real estate agent and loan agent to provide estimated closing
costs of buying a home before looking at homes.
