Jack and Jill are entrenched in the home buying process and everyday they are noticing new “For Sale” signs in yards, mortgage companies television ads, and other Real Estate related happenings. They are in the zone, it wasn’t that their were more homes on the market or that the mortgage companies had bought more television time….Jack and Jill were now paying attention. So they were excited to read about:
#3 Learn What Costs are Involved in Buying a Home
It’s important to understand the closing costs for buying a home, early in the home buying process. You can get that information from your lender or your REALTOR. They both will use different tools to illustrate your closing costs and should be pretty close to what ends up on your closing statement(the final documents your sign before you get your keys).
Your lender can provide you with an INITIAL FEES WORKSHEET when you work with them on your prequalification letter. After your offer on a home has been accepted by the seller it’s time for your REALTOR to send a copy of that contract to your lender. Once the lender has the copy of your contract you can formally apply for a mortgage. The government (Real Estate Settlement Procedures Act) requires that the lender provide you with a GOOD FAITH ESTIMATE within three days. The GOOD FAITH ESTIMATE is just what it says….it is their estimate on what it would cost for you to buy a specific home using their lending services. By understanding the Title Company fees, attorney fees, Homeowner Association Fees and Home Owners Insurance it puts your home buying in a real light of what is paid now to own a home AND what will be paid on a recurring basis (Home Owners Association, Home Insurance, etc)
Your REALTOR can also provide you with an Estimated Cost Worksheet that can give you a good starting point. It will give you basically the same information as the lenders INITIAL FEES WORKSHEET and is just an unofficial estimate. Home Owner Association yearly fees and yearly taxes are posted on most Multiple Listing Services Information Pages, so you may have access to a lot more information than you originally thought. Not all REALTORS provide an ESTIMATED COST WORKSHEET, and that’s ok, your lender is the money person, your REALTOR is the negotiation and home information finding out person and so on.
“Well Jill did we learn anything from this point on our checklist?” asked a puzzled Jack. “Jack is your head bothering you again? Come on now you need to focus, ” scolded Jill. “Of course we learned something. We learned that there are fees involved in buying a home and that we should learn about them by talking with our lender and our REALTOR.” said Jill calmly. “Yea, I got that too, I guess it will make more sense once we have an INITIAL FEES WORKSHEET in our hands,” smiled Jack. And with that being said they eagerly awaited the next check point entitled:
“Jack and Jill Search & Search Some More: The Home Buyer Checklist You’ve Been Looking for (5 of 15)”
We hope you’re enjoying our series and that it helps you on your way to……………………………
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