Buying Your Home - Escrow & Closing Costs

Can I save on closing costs?
Studies show that the closing costs, which can average 2% to 3% of a total home purchase price, are often more costly than many buyers expect. But there are some ways to save:
* We will negotiate with the seller to pay all or part of the closing costs. 
* Some loan products such as VA and USDA loans require no money down. All of our lenders will provide you with full disclosure of fees and potential options.
* Some loans can be assumed with no closing costs. Some loan programs allow for gift funds or retirement funds to be used as down payments. There are First Time Buyer Programs (usually means you have not had title to a home in your name in the last 3 years). Ask us to explain.

What are closing costs and pre-paids?

Closing costs and pre-paids are the fees for closing services, taxes or special interest charges that surround the purchase of a home. They include upfront loan points, title insurance, escrow or closing day charges, document fees, prepaid interest and property taxes, home owners insurance etc.  Unless, these charges are rolled into the loan, they must be paid when the home loan is closed. Your lender will give you a written breakdown of these costs that apply to a specific property as a part of the pre-qualification loan process.

Why do I need a title report?
As much as you as a  Buyer may want to believe that the home you have found is perfect, you you and any finance company the property has a clear title report that ensures there are no liens placed against the prior owners, real taxes are paid up to date, and you are aware of any documents that will restrict your use of the property.  A preliminary title report provides you with an opportunity to review any impediment that would prevent clear title from passing to you.  When reading a preliminary report, it is important to check the extent of your ownership rights or interest. The most common form of interest is "fee simple" or "fee," which is the highest type of interest an owner can have in land.  Liens, restrictions and interests of others excluded from title coverage will be listed numerically as exceptions in the report.  You also may have to consider interests of any third parties, such as easements granted by prior owners that limit use of the property. Some buyers attempt to clear these unwanted items prior to purchase.  A list of standard exceptions and exclusions not covered by the title insurance policy may be attached. This section includes items the buyer may want to investigate further, such as any laws governing building and zoning.  A new staked survey is always recommended by The David Team.

Noel and Paula David
Noel and Paula David
Broker Associates