There’s more costs than you may think!
Imagine this: you’ve set your budget, have a pre-approval, contacted a real estate agent, toured different properties, and you’ve finally found the home of your dreams! Next comes the flurry of negotiations, offers, and paperwork. You’re just about the cross the homebuying finish line when, seemingly out of nowhere, you’re hit with unexpected costs at closing. Then comes the costs associated with moving to your new place. And don’t forget the money needed to renovate your outdated kitchen!
Are you prepared for these surprising costs that come with homebuying? We’re here to help you prepare, plan, and save for the unexpected costs of buying a home.
According to Rocket Mortgage, closing costs are expenses beyond the down payment that you pay upon closing. You can typically expect these to be between 3% and 6% of the loan amount. Common closing cost fees can include:
- Origination fees
- Appraisal fees
- Tax service provider fees
- Title insurance
- Credit report fee
- Lender fees
It's important to note that closing costs can vary significantly depending on factors such as the location of the property, the purchase price, and your loan type. Make sure you review the Loan Estimate and Closing Disclosure provided by your lender, which outlines the estimated closing costs specific to your situation. Our closing costs calculator can help you better prepare and plan for these unforeseen expenses of buying a home.
You can find property tax information on your Pennsylvania county website, a real estate website like Realtor.com, or through a property tax calculator. Once you find the current tax info, however, you should be aware that property taxes can and typically do change based on assessments and tax laws.
In Pennsylvania, property taxes are assessed at the county level. You should expect fluctuations in your tax costs and factor them into your long-term budgeting to ensure you can comfortably manage these expenses.
Don’t forget that physically moving should be a factor when determining the costs of buying a home! Regardless of distance, you’ll need packing supplies and don’t forget about cleaning supplies. You’ll also want to consider the price of furniture if it’s time to upgrade or you need to fill your new space!
It’s inevitable that your new home will need a little TLC. Appliances are destined to malfunction, paint will need to be touched up, and rooms are bound to need some belated spring cleaning. When you’re in the throes of house hunting, the last thing you may be thinking about are the cosmetic expenses of your new home when you’re finally moved in. While saving for your down payment, it may be helpful to stash away some money to help you with these cosmetic upgrades. For unexpected issues like broken appliances, you can dip into your emergency fund if you have one.
As you can see, there are more costs of buying a home than you may expect! But with careful planning and budgeting, you can be well prepared for any surprises.