Sufficiently funding your closing costs is of paramount importance in guaranteeing a seamless real estate transaction. Closing costs include all the expenses you need to pay when you're buying a new home, in addition to your initial down payment.
A widely acknowledged guideline recommends allocating a minimum of 1.5% to 4% of supplementary savings to address these closing costs. To illustrate, for a home with a purchase price of $500,000, while you may allocate $100,000 as a 20% down payment, it is advisable to allocate an additional $7,500 to $20,000 to adequately cover the associated expenses.
Here's a list of approximate closing costs to consider prior to closing:
Appraisal - $300-$500
Home Inspection - $200 - 500
Legal Fees - $1,500 - $3,000
Property Transfer Tax
1% on the first $200,000
2% on the next $200,000 - $2,000,000
3% on the remaining $2,000,000+ value
Title Insurance - $225 - $300
Final Adjustments
Strata Fee Adjustments
Move In/Move Out Fee
Interest Adjustments
Property Transfer Tax Adjustment
Here's some additional closing costs to consider after closing:
Home Insurance
Moving Costs
Furniture Costs
Gas/Heating Setup
Internet/Phone Setup
Realtor Fees
If you're ready to purchase your new home but aren't quite sure how much savings you should have, please feel free to contact me at any time. I'm more than happy to sit down together, and create a plan to help you purchase your new home!