When purchasing a home in Charleston, you must be financially prepared. While a down payment is a large portion of your home-buying expenses, it isn’t the only cost you should prepare to pay. Most buyers can expect to pay between 2% to 5% of the home’s purchase price in closing costs. These are the fees that are accumulated during the home-buying process and should be paid at the time of closing.
There are many types of closing costs you may be required to pay. Here are several common ones you can expect to see.
You may see multiple fees from your lender that cover the cost of completing and processing your application. An application fee, for example, covers all costs associated with the application itself. This covers the cost to acquire a full credit report, appraisal, etc.
Other lender fees that you may see include a courier fee, which covers the cost of transporting your closing documents in a secure manner. An origination fee covers all administrative costs for the lenders and underwriting fees help to cover the costs of underwriting and approving the loan.
This fee helps to cover all expenses for recording the public land records. This money goes to your local recording office.
As a buyer, you are responsible to cover the cost of the home inspection. This will typically cost between $300 and $500. This is not a mandatory expense and it is up to you, as the homebuyer, to determine if you would like an inspection completed on the property prior to purchasing it.
In some situations, you will be asked to provide the interest that will accrue between your closing date and your first mortgage payment. However, some lenders may not require that you pay it at the time of closing. If you are worried about this expense and many others, talk to your lender during the pre-approval process.
In South Carolina, it is required to have an attorney look over all documents prior to closing. This ensures all paperwork is in proper order and there are no potential legal issues. During the time of closing, you will be responsible to pay the attorney’s fees for this process. Depending on the complexity of the real estate transaction, it can affect how much you will be required to pay.
Depending on your current situation and what you agreed upon during the negotiation process, the closing costs you pay can vary. However, it is important you are prepared financially before you choose to purchase a home.
Here at Andrew Paugh – Carolina One Real Estate, I am ready to help you through every step of the home-buying experience. Whether this is your first home or your tenth, I can help you find a home you love in Charleston and Mount Pleasant and that’s within your budget. Reach out today to learn more about buying a home in this beautiful area.