Have you decided to buy a house? Before you move forward and hire an Orlando realtor, answer this question: what’s your budget like?
Money plays a huge role in the home buying process. There are many fees involved, some of which are a given and others that are unexpected. Usually, the expenses range between $20,000 and $15,000. The first expense is one you already know about, which is the real estate commission. According to Zillow, the Orlando realtor commission is 5% of the home’s value. Currently, a single-story house in Florida costs $273,094. Based on this price, the real estate commission would be $13,655. The remaining expenses are covered below:
- First up is the mortgage application fee, which the lender will charge you.
- The home inspection fee is usually $300 and is extremely important. It reveals the problems with the house and if the seller lied about the house’s condition or not.
Expenses related to deeds, titles, legal fees, and land transfers will arise when the final papers are being processed. Usually, the closing cost is from 2% to 3% of the house’s sale. During this time, expect to pay unexpected fees because the final negotiation is a tense process. You just might end up paying a few hundred dollars to move forward.
Insurance and Taxes
Everyone wants to protect their home from disasters. Similarly, lenders want to protect their investment, for which they ask you to pay homeowner’s insurance. It can be paid with the mortgage or through escrow. Expect to pay private mortgage insurance if your credit score was not in the good range. Next up are property taxes that can also be paid with the mortgage.
To make sure that a seller considers you a serious buyer, put down 20% of the down payment. This expense is one of the biggest in the home buying process and usually comes out of your pocket. So, if you are planning to buy a house ASAP, you need to start saving now.
Utilities and Memberships
The utility bills differ based on the area you live in. Make sure that the neighborhood you are choosing has an adequate supply of gas and water so that you don’t end up buying it separately. There’s also the homeowner’s association fee, which is for administration, lawn care, and other maintenance tasks. Not all neighborhoods have a homeowner’s association; so, include this in your research and add it into your budget.
You will be paying repair costs before and after the purchase. If the seller accepts your low offer, you can expect them to add a clause in the contract that you will pay for the minor repairs. The house will have some plumbing problems every now and then. For this, you will have to set aside a cache so that when an emergency arises, you will have the money to pay for it.
There you have it ― the expenses involved in the home buying process. You need to have sizable savings to proceed forward because the biggest expense you should be worried about is the down payment. Let your Dr. Phillips realtor handle the rest. To find your dream Orlando real estate, visit Megan Dowdy Realty or call on 407-509-9279.