I'm happy to see you Back. You may want to subscribe to my blog. Thank you for visiting!
Purchasing a property will always have certain costs associated with it. These costs are called the closing costs and are normal and customary for a home purchase, although some will differ from one state to another, but the components of closing costs are pretty much uniform regardless of which part of the country you live in.
Closing costs are made up of:
(depending on the transaction you might or might not be responsible for all of the above)
A standard closing cost will usually run you about 2% to 5% of the purchase price of the home. Assume you are buying a $800,000.00 home in Southern California, The Closing costs can be a substantial amount if the range is between $16,000.00 to $35,000.00. These amounts are affected during the price negotiations and the offer process for your home. There are several things you can do to save money on your closing costs and here are few examples of them.
1. Negotiation Process:
during the offer process you have to negotiate with the seller. Find out what your estimated costs will be and make sure you try to build some or all of it into the offer. The payment of all closing costs can be a very important part of the negotiation with the seller. This can vary depending on what kind of a Real Estate market you are in. The Sellers motivation to sell and their timing is also very important. Know why they are selling. Do some work and find out why they are selling. Having some facts can help you in the offer process and come out ahead at the end.
prior to making the offer for your dream home, do some research and shop for your closing costs. Mortgage rates are not the only item you need to shop for. Everything from Inspection to Title insurance you can do some shopping around and ask for best prices. This can be a great way to save money. One peace of information you might want to keep in mind, is that the seller has the right to choose the Title and Escrow company.
different communities around the country will have closing costs which are higher and lower depending on the locality of the property. Many high-tax areas of the country have much higher closing costs which will get you toward the upper end of the range 5% to 6%. Some areas will have flat rates on certain parts of closing costs like Title insurance or Escrow fees. Take the time and ask around in your community, friends and family, Realtor advice always helps too. Its always best to research the estimates close to your community, better doing some research, rather than blindly assuming a wrong number as the basis for your closing costs.
4. Timing the Closing Schedule.
It is suggested to try and keep the closing date toward the end of the month. It might seem like penny pinching but every penny will count towards how much you will end up paying for your home. Bottom line many lenders assess a charge between the settlement date and the last day of the month. This is to cover the lenders fees and compensate the lender before you will be paying the full principal and interest payment the following month after closing. Even if a nominal amount is involved this cost can be reduced by a good margin if you schedule your closing toward the end of the month.
5. Full checkup.
make sure you get a good faith estimate right up front. Between the initial good faith and final closing the Escrow, title and others tend to add additional fees and expect you to not notice it. Always compare your Good faith estimate with your final cost sheet and make sure the numbers are what you had initially been promised. If you do see a significant price change on any line item make sure you have access to a good Real Estate Attorney and keep all your legal options open.
Don’t let the process stop you from getting a deal on your next home purchase. Do not be embarrassed to negotiate on the price or costs. If the tables were turned they would be asking or the kitchen sink. So make sure you work on your skills, information gathering techniques and remember if you don’t ask for it the seller will not be offering you any price breaks.
Did you enjoy this article? -Join me today and Receive free updates on Real Estate market, Mortgage Rates and Many remodeling and decoration Ideas via my 📌 Pinterest Boards and Blog.
— Christina Khandan (@ChristinaOCRE) June 7, 2014
🏡 Contact me for any Questions about the Real Estate Market, Schools, Communities around Irvine. If You are planning to Relocate to Orange County or are Looking for Vacation Home & Investment Property Please do not hesitate to Send me an Email
Picture Galleries l Twitter l Facebook l Pinterest
Keller Williams OC Coastal Realty