When you are buying a property it is important to remember that it is not just the list or negotiated price that you will be paying. There are extra costs when buying a house that will be part of the arrangements for finalizing the purchase. You may be able to put in place a loan agreement where some of these costs are absorbed into your loan which reduces what you pay directly out of your current funds but it still increases your loan amount. The following lists five of the common additional fees that you could encounter in this process, and there may be more that could come up in your transaction.
Home Inspection Fee
Part of your usual property purchase arrangements will be a detailed property inspection and the provision of an inspection report. The inspector will go over the property, its structure and systems to ensure that any problems that are going to need repairs are identified. The cost for these tends to range from around three hundred dollars up to five hundred dollars. Having a detailed inspection by an inspector who has some qualifications and suitable experience may cost you more but it will be beneficial if they identify any potential problems before you have purchased.
Property Title Search
The title search will identify if the seller has the right to sell the house, that there are no other outstanding liens or mortgages on the property that will not be finalized with the purchase, or if there are any easements that give someone else access to the property. There are specialist companies that will undertake the title search providing you with relevant documentation and
details for the property. The title search will usually cost from around seventy-five dollars up to one hundred dollars.
Property Appraisal
An appraisal is undertaken to provide a professional estimate of the market value of the property taking into consideration the value of other properties in the location, the condition of the property that is being purchased and if there are any particular characteristics that will influence the price. Appraisals are undertaken by a certified professional appraiser who is not affiliated with the lender as these are intended to be objective and unbiased estimates of property value. The cost of an appraisal will usually vary between around four hundred and fifty dollars and six hundred dollars. The appraisal is undertaken to provide information to the lender but you should make sure you are supplied with a copy as well.
Property Survey
The property survey will confirm that the property boundary details listed in the documentation are accurate. This will be done by a professional surveyor with relevant certification. The cost of a survey tends to be between around three hundred and seventy dollars and five hundred dollars.
Origination Fee
This is the fee charged by the lender to the person taking out the loan which is to cover all of the administrative costs that are incurred in processing and underwriting the loan. The origination fee will vary from State to State. The lender may also include other third parties fees with this such as credit reports. The origination fee will usually be around 1% of the loan amount.
The process of purchasing a property incurs a range of additional costs. It is important to be aware of this when considering your purchase. It may have an impact on the total amount of your mortgage if you roll these into your loan. The details for these fees should be provided to you by any company or professional providing you with services and you are able to confirm that you will be getting what you need for the fees that are being paid.
