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  • Writer's pictureRebecca Richardson - Mortgage Consultant

Check out these factors that go into the cost of your mortgage

As mortgage rates rise and fall, the cost of your mortgage obviously will go up or down as well. But there are a few costs that also are included that impact your overall costs no matter what the rates are doing. There are upfront costs, costs just to put in an offer like a down payment plus costs to close that loan.

I’ve helped thousands of people buy a home and have these tips to help explain the costs that go into your mortgage.

Closing costs In general, closing costs are the fees you pay to get a mortgage and buy or refinance a home.

There are 6 main categories: 1. Lender charges 2. Services you can shop for like the attorney and title fees 3. Services you can’t shop for such as an appraisal or credit report monitoring services 4. Taxes & government fees – recording state and local govt taxes 5. Prepaids – HOI, daily interest prorated from the day you close to the end of the month 6. Initial escrow deposits – typically includes home insurance and property taxes

On average, all of this will cost 2%-5% of the sales price depending on things like the state you’re buying in and other loan details. So, for a $350,000 mortgage, you can expect your closing costs to add another $7k-$17.5k.

A mortgage banker like myself can help you estimate those costs. Just let me know the state – I’m licensed in 30 of them – and price range then I can give you some general numbers for that scenario.

Down payment options With conflicting information lying around and often wrong advice form well-meaning people, let’s talk about how much money you really needed for a down payment on a home.

👉 USDA – 0% 👉 VA – 0% 👉 FHA – 3.5% 👉 Jumbo – 10% 👉 Conventional – 3%-5% 👉 FTHB conventional – 3%

Upfront expenses Buying a home is more than just the down payment and closing costs. There are other upfront costs you’ll want to be prepared for so they don’t come as a surprise.

💵 Earnest money (goes toward the bottom line) 💵 Inspection 💵 Appraisal

If you are preparing to buy a 🏠, be sure to budget for these expenses and be sure to subscribe to my YouTube channel to learn more.

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