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The Importance of Closing Costs
Dated: May 25 2021
When buying a home there are some added costs that you must consider. Having enough funds for the down payment is not enough, the closing costs should also be prioritized.
Before anything else, one must have a concrete plan in buying a home. Everything must be put into account. Additional upfront expenses such as closing costs, title costs, and any fees you might need to pay for escrow. Once you’ve factored all of these aspects, you’ll be good to go.
If you’re interested in purchasing a home in the future, here’s what you need to know about closing costs:
What are the importance of closing costs?
There are many transactions that comprise closing costs such as, processing your loan (if you’re applying for a conventional loan), recording of the sale transaction with the county office, home appraisal, inspections, and the cost for the title. A part of these expenses are the accumulated taxes and the insurance as well.
Do you pay for closing costs when in contract? Or on closing day?
Closing costs are to be paid once your loan is finalized. This happens on the day of closing. This is also the time when you’ll be required to pay your down payment.
What is the percentage of closing costs?
The total amount to be paid for closing costs are different for each home. This depends on different factors. Such factors include, your loan amount, the lender, the location of the home, the title company, and many more. In terms of percentage, this generally ranges from 2-5% of the remaining mortgage balance. This is if you’ll be doing a conventional loan. Paying in cash has a cheaper closing cost compared to having a loan.
What is our best advice to buyers regarding closing costs?
The best advice we can give to buyers regarding closing costs is to be knowledgeable in all aspects of the sale. Be cautious of the lender you’ll choose, negotiate with them as well. It is also a good idea to choose the title company wisely. Being up-to-date on these aspects will definitely help you save hundreds, if not thousands of dollars.
Closing costs are not only pertinent to a buyer. Sellers also pay closing costs, so be prepared.
We at the Stephanie Woods Team will fully explain to you all details of the sale including closing costs. We are always on your side so let us help you start your real estate search. Our agents service not only the Prescott area but all of Yavapai County, Arizona including the Verde Valley. Please feel free to check out our online Google reviews. Stephanie Woods is happy to have her team help with all of your real estate needs. We can also locate and interview a qualified agent in another state to make sure you are getting the qualified agent you desire for your new purchase or sale. Stephanie Woods has a large referral network she works with that exudes excellent customer service. Call us today as we look forward to servicing your real estate needs.The Stephanie Woods Team at Better Homes and Gardens Real Estate BloomTree Realty 928-237-4455 prescottazhomefinder.com.