Welcome to the last segment of our five part blog series, "Keystone Keys to Savings." In this final blog post we’re discussing closing costs, what they may cost you and your payment options. Understanding closing costs can ensure you’re more prepared to unlock the door to your dream home!
What are Closing Costs? To embark on a successful homeownership journey, it's essential to comprehend what closing costs entail. Closing costs encompass various fees and charges associated with finalizing a real estate transaction, covering expenses like loan processing, title insurance, and more.
How Much Will This Cost You? Closing costs can vary, typically ranging from 2% to 5% of the home's purchase price. Understanding the potential financial commitment is key to effective budgeting during the homebuying process.
Payment Options for Closing Costs: Explore various avenues to cover closing costs, allowing for flexibility and strategic financial planning.
Example 1: No Builder Incentive with Conventional Loan
$300,000 home price, 30 year term, 5% down payment, 7.22% interest rate = $2,680 closing cost
Example 2: With $2000 Builder Incentive with Conventional Loan
$300,000 home price, 30 year term, 5% down payment, 7.22% interest rate = $680 closing cost after builder incentive?
Example 1: No Lender Incentive with Conventional Loan
$350,000 home price, 30 year term, 5% down payment, 7.22% interest rate = $3,154 closing cost
Example 2: With $5000 Lender Incentive with Conventional Loan
$350,000 home price, 30 year term, 5% down payment, 7.22% interest rate = $154 closing cost after lender incentive
Understanding and mastering the intricacies of closing costs are vital steps in securing your dream home. By understanding closing costs, what they may cost you and your payment options, you empower yourself to make informed decisions throughout the homebuying process. Thank you for joining us in our "Keystone Keys to Savings", feel free to navigate our blog for more information regarding Financing, Construction, Design, and more!
Note: The calculation provided above reflects current average interest rates as of 12/1/2023. It is also mportant to acknowledge that these interest rates are subject to change based on factors such as location, credit score, loan amount, down payment, loan type, and terms. As interest rates fluctuate frequently, this is not a financial quote but is intended solely as a self-help tool for personal use. It is not meant to offer investment advice.
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