Closing Costs Buyers Need to Be Aware Of

Your down payment is only one of the expenses you need to save up for when buying an Inland Empire home. You also need to save up for your closing costs. While these costs for a Riverside County home average about 5.35% of its sale price, the actual number may vary. These are the five main closing expenses that every buyer should keep in mind when saving up for their dream home.

Closing Costs Buyers Need to Be Aware Of

Lender Fees

Lender fees encompass a wide variety of fees associated with the processing, approval, and funding of your home loan. They include a loan origination fee, underwriting fee, and processing fee, among others. They may also include any discount points you pay to decrease your interest rate.

Escrow Fees

Next up on your list of closing costs are your escrow fees. The escrow company holds all money involved in the real estate transaction. At closing, they determine who is owed what and distribute the money accordingly. In California, both the buyer and seller typically split the escrow fees evenly between each other.

Appraisal Fee

Lenders will not approve a mortgage loan for more than what a property is worth. Therefore, they require that an appraisal be performed. As the buyer, you must pay for the appraisal.

HOA Fees

It is almost impossible to find an Inland Empire home that is not located in a homeowners association (HOA). They do exist…but they are rare. Therefore, another closing cost you may find yourself paying is the transfer of HOA fees from the previous owner’s name to yours. Plus, you may end up paying pro-rated HOA fees as well as a capital improvement fee.

Inspections

While not technically a “closing cost”, a smart home buyer should never pass up getting inspections done on their home. In fact, depending on what the initial home inspection finds, and the condition of your home, you may end up paying for several specialized inspections in addition to your initial home inspection. For example, you may want a roof inspection done as well as a more thorough HVAC inspection. And if your home includes a swimming pool, you may want to hire a company specializing in that arena as well. Remember, the problems that any of these inspectors uncover before your final closing may end up saving you thousands of dollars down the road. So conduct as many inspections as you must to feel confident in your home purchase.

Muna Dionne, your Inland Empire specialist with Coldwell Banker Realty