Finding beautiful, custom homes in Greenville, SC, can be difficult. The whole process can be exciting and exhausting.  From understanding escrow to wading through inspections, home buying can be confusing and costly. Do not get discouraged. When you do the research, buying your dream home will be a breeze. The secret is to be prepared for closing costs. 

If you do not know what closing costs are, do not worry, you aren’t alone. Most people are not aware of everything that goes into those closing papers. Closing costs are simply the fees that are paid when you close on a home. These fees range from application fees to title fees, and they can add up quickly. 

Closing cost fees generally depend on the value and price of the home you are buying. Usually, closing costs range from 2% to 5% of the home’s price at the time of purchase. If you are buying a home that is $250,000, expect to pay anywhere from $5,000 to $12,500 in closing costs. Those costs are added on top of your down payment when you close on your home. Closing costs can shock many homebuyers and could end up costing them the deal. 

One of the biggest mistakes many first-time homebuyers make is not saving up for their closing costs. However, when you take the time to find out what closing fees are required in your area, you will be ready to take the plunge. We have come up with a quick rundown of common closing costs and how to lower these fees. 

Which Closing Costs Can I Expect During My Home Purchase?

Closing costs depend on your region. Different states have different fees and different requirements for buying a home. Greenville, SC, home builders and real estate agents can help you navigate the housing market’s local regulations. However, there are some routine closing costs that come up in most markets. Here are some fees that you are likely to discover on your closing papers. 

• Application Fees: Many lenders charge an application fee to help cover the costs of background checks. Sometimes this fee will also include credit report costs and appraisal fees. You can cut back on this cost by shopping around for lenders. Find a lender that is willing to waive the fee or has lower fees. 

Average Costs: $300 to $500 

• Title Search: Any lender you choose will do a title search. These searches make sure that there are not any liens on the property. Finding a lien can gum up the works or leave you responsible for someone else’s bill. It ensures the sale is clean and clear. 

Average Costs: $200-$300

• Title Insurance Fees- If your title search comes up clean, that does not always mean you are in the clear. Even if you choose new construction homes in Greenville or Spartanburg, liens can still show up. To cover possible costs, lenders will require you to pay a title insurance fee. Title insurance fees can get expensive quickly, so, be prepared.

Average Costs: $800 to $2000

• Homeowners’ Title Insurance: While this fee isn’t required in many states, it is still an important option for new homebuyers. With the owner’s title insurance policy, you can cover your own costs if liens are discovered. 

Average Costs: $200

• Attorney Fees:  Another optional fee is the cost of attorneys when closing a house. Most states leave closing documents to the real estate agents. However, sometimes the sale of a home is complicated, or state law may require an attorney during your closing. Either way, attorneys can help you handle the finer details of property law. Check with your state regulations and consult a realtor to help you know when you will need a lawyer present. 

Average Costs: $400- $1000

• Private Mortgage Insurance Fees- This fee, called a PMI happens when you have less than 20% for your down payment. Some lenders will not even look at offers with low down payments. If they do, they are going to charge you a fee to cover the risk. At the same time, you may qualify for FHA or VA loans, which can reduce the PMI and the down payment needed to buy a home. Discuss all these options before you start shopping the market of Greenville’s custom-built homes. 

• Appraisal Fees- Lenders must have properties appraised before they can offer a loan. They will hire an independent appraiser to find the current market value of the home you are buying. Appraisals can hurt or help a deal, but the fees stay standard across state lines. 

Average Costs: $300 to $500

• State Estate Taxes and Mortgage Stamps- State and local governments often collect taxes based on your property value or mortgage loan. Make sure you research local property tax practices, so you won’t be stuck without enough funds at the end of your deal. 

• Home Inspection Fees: Home inspections are not always required by law, but they are a vital part of the process. Inspections can catch expensive issues or minor repairs that you can include while you negotiate a price. Skipping the inspection can cut down on fees, but it can also be a huge risk. You don’t want to be left with a house that needs repairs without enough money to fix them. 

Average Costs: $200 – $400

• Mortgage Taxes and Real Estate Transfer Fees: Often, states will charge taxes or fees on the price of your home at closing and the amount of your mortgage. Typically, the transfer fee is a fraction of the value of the home at closing. Some states have you pay $1.00 on the first $1,000 of your property value and then charge cents on each thousand dollar value after that. 

Average Costs: These costs can get confusing, so consult a professional real estate agent or your lender for exact costs. 

Are you still confused about closing costs? Not sure if you will have enough to pay for all the fees on top of your down payment? Do not worry. Contact the friendly team at Enchanted Homes at 864-895-0601. We can help you work through the process as you plan your dream home. Our staff is experienced, knowledgeable, and ready to work with you. We will make your home buying journey a breeze.