Scouring the New Jersey real estate market for the home that perfectly fits your budget, your tastes, and your needs takes a lot of effort. Likewise, packing up all of your worldly belongings and transporting them across the town, the state, or the country is no easy task.
When it comes to the financial aspects of the deal, the down payment is sure to be at the forefront of your mind. You've likely had to think about how much can you afford to pay up front and how much will you need to finance through a lender, but it's easy to forget about the home buying fees that accompany most successful transactions.
Closing Fees In New Jersey
Bergen County has some of the highest closing fees in the state. In part, this is linked to the fact that Bergen County real estate is some of the most prestigious in the area. In a circumstance where higher legal fees, higher property taxes, and insurance costs come into play, closing costs can exceed $10,000. Generally, you can expect to spend 2.2% of the median home price on closing costs.
Here's a quick rundown on some of the fees you can expect to pay on your next home purchase. Some are worth their weight in gold and others are only necessary under special circumstances.
If you'll be purchasing your new home with the help of a mortgage or bank loan, you'll need to have a property appraisal done. When a lender gives you thousands of dollars to invest in your home, they'll need to see assurance that your home is worth what you're planning on paying and that the risk they assume is reasonable. The appraisal will compare the home to similar nearby properties that should be worth a similar dollar value. An appraisal generally costs around $400. It's likely you'll also need to purchase home insurance to qualify for a loan.
While a home inspection is optional, in many cases they are well worth the investment. While buying a new home can be relatively uncomplicated and a home inspection likely won't reveal anything out of the ordinary, a home inspection can be worth its weight in gold when purchasing an older home.
The Ridgewood real estate market is full of historic beauties, and although many of them have been lovingly and carefully maintained over the decades, some of these houses are accompanied by the problems that come with old age. As such, having an expert lend their eye to spot problems with water lines, wiring, termites, and other prospective issues can save a home buyer thousands of dollars in the event that there is a major issue with the home. A home inspection can be purchased for upwards $600 dollars.
Title Search & Title Insurance
Both a title search and title insurance are required by the state of New Jersey. The title search investigates the history of a property's records and ensures that the seller has legal power to sell their property. Sometimes, if there is dual ownership that they were unaware of, this is not the case. The title search also examines the property line and ensures that your house is on your land and your neighbor's building is in their yard.
Title insurance is a mandatory one-time fee that is purchased by both the seller and the buyer that protects both parties from any complications with the title of the property that may arise after the title search. The title search generally costs between $250 and $500 and the cost of title insurance varies.
In New Jersey, you aren't required to have a lawyer to purchase a house, but if you do elect to get one, they can review your contract, help you get title insurance, and guide you through any other legal proceedings. A good lawyer will usually cost around $1000. If you do get a lawyer, it's important you get one that specializes in real estate and knows Bergen County. Specialized and local knowledge is key.
Alternatively, if you decide not to get a lawyer, an experienced real estate agent can often help you review contracts and give you advice based on their experiences with previous deals they've closed.
If you're buying a luxury home in Ridgewood that is evaluated to have a worth over a million dollars, you'll need to pay mansion tax. This tax is unique to New Jersey and costs 1% of the home value. 1% of a million dollars is $10,000, which means that this tax can quickly increase the closing costs on your home.
There's no doubt that closing fees can quickly accumulate, and if this is your first home purchase, you might find that the list of extra expenditures can be intimidating. That's why it's important to work with an experienced Ridgewood real estate agent. They will help save you money on the cost of home to help you balance the cost of these fees. Tarvin REALTORS® understand the worth of Ridgewood real estate, and they can help you save money on the house sale and negotiate a fair price for your new property.
Contact Tarvin REALTORS® for more information about how they can help you in your next home purchase.