There are various things to learn as a first-time homebuyer. Even if you are a seasoned realtor, states have different requirements and restrictions, so what is a necessity in your town may not be a prerequisite in another. If you are looking to purchase a new home or property in Florida, buyer closing costs and prepaids are some of the critical areas you should review. Below is a brief look at these costs, including what to anticipate:
The price of the property you are purchasing remains the major buyer closing cost. It is also known as the Contract Sales Price on the Integrated Disclosures.
Most lenders take different kinds of prepaids, which are portions of the buyer’s taxes and insurance premiums. The prepaids are held in escrow and offer guarantee that the lender will have the loan amount available when needed. Some lenders also allow new owners to pay the prepaids when the date is due. In South Florida, if prepaids are included in the closing statement, they usually feature the following costs:
There are several additional fees that a lender may charge as part of buyer closing costs and prepaids. You will be required t pay the government fees such as stamp tax on the mortgage and recording the mortgage in public records. Other miscellaneous fees include flood certification to determine the flood zone location, tax certification to confirm that the property’s taxes have been paid in full by the current owner and homeowner (condo) association fees for recording purposes. In many cases, the monthly, quarterly and annual association fees are paid in advance by the seller to be refunded by the buyer. Home and termite inspection fee is another cost you may incur if the buyer did not prepay them. You may also pay a home warranty premium if you take out a warranty on plumbing, HVAC, or any other aspect of your new home. What’s more, the title agent may charge different amounts for an out-of-office closing, where courier costs are passed to the buyer.
As a new home buyer in Florida, you should anticipate a few other costs, such as attorney fees, especially if your states require that licensed attorneys handle all closing. It is also advisable to hire attorney services to help you understand and get through the closing period. Most law firms that deal with mortgaging offer a free consultation, so finding one shouldn’t be a daunting task.