From the time you make an offer on a home to closing day, you’ll be writing a check (or two, or three!). Here are the times during the home buying process you should be prepared to haul out your checkbook:
When making an offer. You’ll be asked to provide an earnest money check at the time you submit an offer on a property. Buyers show they are serious about a home purchase by putting down earnest money of $500 to $1,000 or more. In today’s market, some buyers are offering even more money in an effort to stand out among other buyers in multiple offer situations. This check isn’t cashed right away, of course. If an offer is accepted, it’s deposited into an escrow account in preparation for closing. A check is returned to a buyer whose offer is not accepted.
When getting the home inspected. Offers are typically made contingent upon a home inspection — and for good reason. Hidden or unknown defects can cost thousands, even tens of thousands of dollars to fix down the line. Many home inspections run around $300 to $500. You’ll pay that amount directly to the home inspector. In addition to a general home inspection, a buyer may elect to pay for a termite inspection and/or a radon test. Other more specialized inspections are available for an added cost.
When applying for a loan. Most lender fees are handled on closing day, although you may be required to pay for your credit report and appraisal around the time you apply for your mortgage. These costs vary.
Want to learn more about the home buying process? Give us a call. We’ll be glad to help.