Estimated Upfront Costs of Buying a Home

It's important to understand the upfront costs of buying a home before you buy so you're not blind-sided.

Earnest Money

Earnest Money represents a buyer's good faith to buy a home. It's typically 1% of the purchase price and is due with 48 hours of contract acceptance. It's deposited in an account held by the Title Company until close of escrow.

This can be refunded or put towards your closing costs or down payment at the close of escrow.

Down Payment

Down Payment minimums will be determined by your pre-qualification or pre-approval amount and loan program and is due by signing before close. Many primary residence loans require as low as 3.5 - 5% down, whereas typical investment property or second home loans may require at least 20% down. You can always put more money down than the minimum.

There are great first time buyer down payment assistance programs that can help first time buyers come up with their down payment.

Closing Costs

Closing Costs are expenses beyond the down payment and may include title insurance, attorney fees, loan origination fees, appraisal fees, taxes and more. Closing costs are typically 2 - 5% of the purchase price and due by closing.

It is possible to negotiate the seller's help with closing costs.

Inspection Fee

Inspection fees pay for a licensed home inspector to write up a full report on the property to shed more light on the condition beyond what you can see during a walkthrough. Inspection fees are due at the time of inspection, typically in the first 10 days under contact. The fee can be up to $600 depending on the size of the home.

The inspection period opens up more negotiation between the buyer and seller.

Appraisal Fee

Appraisal fees are due when the appraisal is ordered, typically in the last 10 days under contract. The fee can be up to $600 depending on the size of the home and the lender.

The appraisal opens up more negotiation between the buyer and seller.

Other Moving Fees to Consider

Moving costs, utility transfers, HOA fees, appliances, furniture, maintenance, updates, landscaping, emergencies, etc.