The costs of
buying a home
There are many costs involved in buying a home. The time cost can greatly be reduced by spending more money. Or much of the money spent can be replaced by spending more time.
The costs involved are:
Determining the location where you want to live,
finding out how much you can afford,
finding the home you want,
negotiating the price of the home,
obtaining financing if necessary,
closing the deal,
preparing the new home for move in,
moving to the new home,
setting up appliances, utilities, new financial arrangements, and new arrangements for your family.
Determining where you want to live involves figuring out your reason for moving, (usually the easiest part), determining how much you can and want to spend, finding a suitable neighborhood for your needs.
Finding out how much you can afford is also fairly simple. If you're not borrowing money to buy your new home, you only need to decide how much savings you want to invest. If you're planning on borrowing money, you can start looking around and negotiating for a pre-approved mortgage. The lender will assist you in determining the maximum amount you can spend. You'll also want to find out what costs involved are tax deductible at this time.
Finding the home you want, can be as time consuming as you want. You can go looking for a property yourself, driving around, looking through ads on the internet, in local newspapers and magazines, and looking for "for sale" signs in neighborhoods you like.
Negotiating the price of the home, can be easy or hard. You can sometimes deal directly with the seller. You can also deal with the sellers agent, or you can hire a lawyer or agent of your own to negotiate for you. You'll want to have at least a home inspection and contract clauses to deal with any deficiencies, look over the seller's home disclosure statement, possibly have a contingency for pest inspection, a contingency for you failing to get financing, and a host of other contract details. You might want a home owner's warranty, even if you have to pay for it.
Obtaining financing if necessary, can be easy or difficult. If you've pre-arranged the financing, you're mostly set. If not, you need to find a borrower, pay application fees, pay for a land survey, home appraisal, home and possibly flood insurance, credit reports and a host of other fees. You also need to negotiate an interest rate scheme with your lender. You can pay more up front to lower your interest, or pay less and get a higher interest rate.
Closing the deal is usually the expensive part. This can be straightforward and quick, or more complicated and time consuming. You should have a final walk through the property directly prior to closing, to make sure all is well. At this point, the lender, seller, lender's legal team, maybe your legal team, a closing agent, and yourself will sit down and complete all the transactions necessary. This is where you pay the down payments, initial principal and interest, title insurance, taxes and recording fees, prepaid (or refunded) utilities, prepaid property tax, home owners' associations, initial insurance, escrow and other fees. Contracts are signed, money changes hands, and the home is yours.
Preparing the new home for move in, again can be easy or difficult. If the home is in good shape, appliances are installed, the home is pest free, there's easy access to move in furniture and equipments, and no repairs or renovations are necessary, you're almost set. You'll need to active utilities, like electricity, phone, gas, cable, internet and whatever else you need. Changing locks, installing home alarms or monitoring service is also done at this time.
Many times, new owners like to take time to prepare the new home before move in, because it's much easier and less expensive, and more comfortable to do all this while the home is still empty of furniture and people.
Moving to the new home, can be simple or not. You may need to hire a moving company, pack your old home, disassemble large items, cut off utilities, sell your old home, transport everything, including cars, children, pets, plants and everything else without damage or delay. Then you need to move everything into your new home, assemble everything, check for damage, file insurance reports if necessary, set up any appliances or equipment you need, turn on utilities if not done already, and that's just the start.
At this point, you'll need to settle in to your home and location. Change of address forms, change of phone number, arranging new schools for children, doctors, vets, write a new will if you're in a new state, transfer professional licenses, commuting arrangements and the works.
The various costs and cost options can be found thoughout this Jolemon website. Time now to start your homework and plans for buying your new home.
When you're finished with all the above, it's time to meet the neighbors.
