Myth – Your Only Cost is a Down Payment
The fact is, there are many additional costs that you will incur during the course of buying a home. Some of these costs may include:
- Appraisal – required by your lender and paid in advance by you, as a buyer, typically as soon as your purchase contract offer is accepted. A residential appraisal can cost between $400 to $500.
- Closing Costs – while there are many costs in this category, the major closing cost items are the escrow fee ($400 or more when equally split), title insurance ($800 or more; the Seller typically pays for a policy for you, as Buyer, which may cost twice as much!)-for the benefit of your lender, and Nevada transfer tax (this tax varies by county and is usually equally split between Buyer and Seller. Rates vary between $390 and $410 per $100,000 of the purchase price based on which county you are buying in). Customarily, closing costs are split between the buyer and seller of the home. These costs are paid at the final closing of the home and, if the purchase does not go through, the Buyer pays none of them – whew!
- Inspections – depending on the property, you may need multiple inspections. Inspectors can be paid at the time of service or at the time of the closing, but unlike the closing costs mentioned above, they must be paid if you purchase the property or not once the inspector has delivered service. The range of potential inspections include: home inspection ($300 to $450), wood destroying pest inspection ($120 to $180), heating/cooling inspection ($80 to $100), septic system pumping and inspection ($400 to $600), private well inspection and water quality test ($400 to $600).
- Pre-Paid Insurance – many lenders will require you to prepay your home insurance premium for between three to six months at the time of closing. While you would be paying for insurance anyway, the prepayment requirement does increase the amount of money you may need to close escrow on your home.
Fortunately, as a buyer, you do not need to pay real estate brokerage fees as part of your closing costs – these fees are paid by the home seller as part of the sale proceeds.
As outlined under Federal and State of Nevada Programs on this site, you may qualify for down payment assistance which would cover the down payment AND the closing costs which can be combined and paid at the closing. Complete the form below for a free consultation with a lender who can review these costs and available programs you may qualify for!
Additional Home Buyer Resources