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WHAT DO YOU DO NOW?
WHERE DO YOU BEGIN?
| This information is based on the typical
costs associated with BUYING a home in the Birmingham
Alabama area. Other areas of the country and state
have different standards and customs, so this applies
to our area only. |
Buyer's typically pay for the mortgage
costs, 1/2 attorney fees, 1/2 title fees, recording
fees, and so forth. |
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There are BUYER closing costs and SELLER closing
costs. Many people don't know the difference, so
here's my guide for the Birmingham Alabama Real
Estate area. |
Who pays? Buyer or Seller?
It's not that clear, but here's a rough guide. |
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- 1/2 Title for Lender
- 1/2 Title for Buyer
- 1/2 Attorney Fee
- Mortgage Fees
- Survey
- Inspections (Home, septic, roof, EIFS,
etc...)
- Home owner insurance Premiums
- Pro-rated Taxes
- Down Payment
- Recording Fees
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- 1/2 Title for Lender
- 1/2 Title for Buyer
- 1/2 Attorney Fee
- Termite Contract
- Realtor Commission
- City verification letters
- Pro-rated Home Owner Insurance Premiums
- Pro-rated Home Owner Association fees.
- Pro-rated Taxes
- Current Loan payoff fees, wiring fees
- Current Loan payoff
- Other property Liens
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EXAMPLES AND ESTIMATES
ONLY!
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| SALES PRICE OF $100,000
BUYER COSTS, 3% Down |
SALES PRICE OF $100,000
SELLER COSTS |
| BUYER SIDE FEES |
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| Loan Amount |
$97,000.00 |
| Origination Fee |
$970.00 |
| Appraisal Fee |
$450.00 |
| Credit Report |
$25.00 |
| Underwriting Fee |
$400.00 |
| Flood Certification |
$50.00 |
| Recording Fees to County |
$250.00 |
| Inspection of Home |
$300.00 |
| Inspection of Septic System
(If needed) |
$250.00 |
| 1/2 Attorney Fee |
$300.00 |
| 1/2 Title Fees |
$280.00 |
| Home Owner Insurance |
$450.00 |
| Taxes (Varies greatly per county!) |
$500.00 |
| Pre-Paid Interest to lower your rate? |
Varies |
| Interest Rate of Loan (Varies greatly) |
6.75% |
| MONTHLY PITI PAYMENT |
$785.00 |
| Total Needed to close is roughly: |
$6,100.00 |
| **A Seller IS ALLOWED to contribute
and actually pay up to 3% of a Buyer's Closing
Costs and Pre-Paid items, but is not allowed
to fund the 3% Down Payment under the new
FHA guidelines as of 10/1/2008. There may
be a special community program available for
down payment assistance, but this has been
a rarity in my experience for most buyers. |
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| SELLER SIDE FEES |
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| 1/2 Title Fees |
$280.00 |
| 1/2 Attorney Fees |
$300.00 |
| Termite Contract |
$150.00 |
| 3% Selling Broker Commission |
$3,000.00 |
| 3% Listing Broker Commission |
$3,000.00 |
| Pro-Rated Taxes: Varies on closing date... |
Varies |
| City verification letter that home has no
lien |
$10.00 |
| Home Warranty (Can be paid by Buyer) |
$500.00 |
| Misc courrier fees, current loan payoff,
etc... |
$100.00 |
| Current Loan Payoff |
Varies |
| TOTAL ESTIMATED FUNDS AT CLOSING ABOUT: |
$92,200.00 |
| Of course, if the Seller pays
any of the Buyer's Closing Costs and Pre-Paid
items, that amount would be added to the costs
above. Sellers are generally allowed to pay
up to 3% of the Buyer's Closing Costs, but
not allowed to pay the Buyer's down payment
under new FHA guidelines as of 10/1/2008. |
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This is an example,
of course. And variables that can change greatly
include the taxes in your area, the cost of your
Hazard Insurance, a.k.a. Home Owner's Insurance
Policy, current loan payoff for the Seller, and
so forth. However, these numbers came right from
a HUD1 for a property sold recently. |
Here's my personal
note to potential home buyers.
If you don't have any money for a down payment,
save it. You will need it in this current market.
Now is the time, if you have not done so already,
to put a basic personal budget together for your
long term financial stability.
No longer should home buyers purchase a property
without reading the details
of their mortgage program. If
you don't know what the meaning
of an ARM is, or Fixed Rate
option, talk to a qualified
MORTGAGE PROFESSIONAL! Our economy,
and your future, is too important
to go blindly into a transaction
that may lead to a serious financial
catastrophe.
Thank you for considering me for your real estate
needs. My slogan is "Finding and Fitting
the needs of my clients!"
Sincerely,
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