Common Homebuyer Costs
That You Should Be Concerned AboutLearn about common home buyer costs that you should expect if you plan on purchasing a home in the future


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If you are considering purchasing a home or refinancingyou can go to quickenloans.com or lendingtree.com along with local mortgage lenders in your areato determine what loan will best suit youand your family.  You can compare closing costs, APR's and Par rates to determine what loan will best serve yourand your family's long-term interests.



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NOTE: This estimate has been prepared to assist the buyer in computing costs. Lenders and other related services will vary in their charges; therefore, these figures are not and cannot be guaranteed by the-best-atlanta-real-estate-advice.com, or any of its affiliates.



Estimated Buyer’s Cost:



Property Address:

123 Anytime Street

Atlanta, GA 30303



Earnest Money Deposit $1,000

Sales Price: $185,000

Down Payment: $10,000

Amount Financed: $175,000



LOAN ITEMS:



Loan Origination Fee: $1750 S

Appraisal Fee: $300 (POC)

Credit Report $8 (POC)


ADDITIONAL LOAN FEES:


Application Fee: $375 S

Tax Service Fee: $78 S

GRMA Fee: $6.50 S


PREPAID ITEMS:


Interest: 10/16/09 to 11/1/09 16 days $508.22


Hazard Insurance: $53.41 * 3 = $160.23 Annual Policy = $640.97 $801.20


Mortgage Insurance Premium $1312.50 (No monthly reserves required) (Lender credit given for $1312.50 To purchaser)


Taxes: $212.13 * 2 $424.26


Assessments: 0


Other Fees: 0



TITLE & CLOSING CHARGES:



Attorney’s Fee: $450 S

Escrow, Settlement or Closing Fee: 0

Title Insurance: $250 (POC) $356.25 Lenders Policy

Notary Fee: 0

Other Fees

Title Examination: $7.50 $117.50 S

Wire Fee: $20


RECORDING FEES:


Recording Fees $70 S

Tax Stamps: Deed: (.001) $175 S Mortgage: (.003) $525 S

Other Fees 0


ADDITIONAL SETTLEMENT CHARGES:


Survey: (Not required or requested) 0

Pest Inspection: $65 (POC)

Document Review Fee: $250 S

Home Warranty $325 (POC)

Home Inspection Fee $300 (POC)

Other Fees

Flood Certification: $6 S

Administrative Fee: $50 S

Processing Fee: $330 S Flood Certification/Life: $2 S


Total Settlement Charges: $3422.43


Down Payment: $10,000


Total Estimate of Buyer’s Costs


Loan Type: 95% Fannie Mae My Community

Amount Financed: $175,000

Interest Rate: 6.625%

Term: 30 years


Estimated Monthly Payment


Principal & Interest $1120.54

Mortgage Insurance Premium $87.50

Taxes & Insurance $264.54

Homeowners Assn. Fee (if any) 0

Total Monthly Payment $1473.58


NOTE: This estimate has been prepared to assist those considering purchasing a home in computing costs.


Lenders and other related services will vary in their charges and what they consider closing costs.


Different types of loans and how your real estate agent negotiates on your behalf is also a major factor, therefore these figures are not and cannot be guaranteed by the-best-atlanta-real-estate-advice.com, its employees, or affiliates.




WHAT IT ALL MEANS...




Seller paid $4,000 (54%) of the $7,422.43 in purchaser closing costs (Note all entries with an “S” on the right are Closing Costs that the seller paid).


The $10,000 down payment reduced the loan from $185,000 to $175,000.


The $175,000 sales price plus the settlement charges of $3,422.43 plus the County Taxes that the SELLER already had paid for the year is pro-rated to the buyer/seller as a matter of fairness---10/16/09 to 12/31/09 ($530.04) should and will be paid by the purchaser since the taxes have already been paid and he/she will be the owner of record during that period.



The reverse scenario would play out if the seller had not paid the taxes. (i.e. the seller would receive a credit for the months that the seller occupied the property and the purchaser would pay the taxes later in the year.)



The $10,000 Down Payment is also added in.


$175,000 + $3,422.43 + 530.04 + $10,000= $188,952.47


The $188,952.47 is the GROSS AMOUNT DUE FROM BORROWER


As mentioned above with this loan the lender is crediting back the MIP of $1312.50 to the purchaser.


$175,000 Loan Amount plus $1000 Earnest Money plus $1,312.50 Lender Credit equals $177,312.50 WHICH IS THE AMOUNT PAID BY/FOR BORROWER



THE GROSS AMOUNT DUE FROM BORROWER LESS THE GROSS AMOUNT PAID BY/FOR BORROWER EQUALS THE CASH NEEDED FROM BORROWER AT CLOSING.



$188,952.47 – $177,312.50 = $11,639.97


The $11639.97 is the TOTAL SETTLEMENT CHARGES and the amount the Purchaser would need in the form of a cahier’s check at closing, although it is wise to bring 10% more.


The Closing Attorney will cut you a check at the closing for the difference.


Remember that the purchaser had total out of pocket costs of $13,887.97 for the purchase of a $185,000 house with 5% down.


$1,000 Earnest Money (E.M.)


$1248.00 Paid Outside Closing (POC)


$11639.97 CASH FROM BORROWER AT CLOSING

TOTAL = $13,887.97




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Thomas (TJ) Underwood has been providing financial advice as a tax practitioner since the mid 1980’s and began his financial planning career (while earning a Bachelor of Science Degree in Business Administration/Finance/Marketing), in Detroit at Wayne State University.  From 2010 up to the present he continues to provide visitors timely personal finance and wealth building advice and articles—including real estate advice—on 3 sites that he has created since 2010. 

Even though he is an active real estate Broker in the Atlanta Metropolitan area, he continues to blog consistently to help visitors and those who desire lasting financial and life changing success the opportunity to change their life for the better in a more efficient way. 

You can learn more about him and gain access to all three sites that he has created by going to Who is the creator of TheWealthIncreaser.com page.







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