When purchasing a home, most everyone knows they will need a down payment along with the mortgage, except the fortunate few who will pay cash for their new home.
What most people either underestimate or don’t think of is the closing costs. Here’s an idea of what the closing costs will be in New Jersey.
As a rule, most purchases will have closing costs between 2% and 7% of the purchase price. A wide range, right?
Cash purchases will have lower closing costs. But when purchasing with cash there will still be costs for:
* Title Insurance and Title Company Fees
* Attorney Fees
* Homeowners Insurance
* Flood Insurance – if this applies
* Home Inspection
* Well and / or septic system inspections – if needed
also – many homeowners associations charge for the transfer of ownership. Check with your Realtor for the amount, if any.
If you’ll be taking a mortgage there will be additional costs incurred.
* Bank Fees
* Mortgage Origination Fees
* Pre-Paid Interest (the interest due between the date of closing and the date the first payment is due)
* Property Tax Payments into Escrow
* Prepaid Homeowners Association dues – if applicable
* Private Mortgage Insurance premiums – if applicable
There will be additional smaller costs. We recommend that you speak with your attorney and your mortgage representative early and often. It’s not fun find out you additional unexpected expenses right before the closing.