What Are the Costs of My New Home?

One obvious cost of buying a new house is the mortgage loan itself, but it's far from the only price you'll pay when buying your new property. There are a long list of costs associated with buying a new house, and it's to your advantage to understand them before you even begin the home buying process. Factoring these costs into your budget can make the difference between being able to afford a mortgage loan and deciding it might be easier to rent for a year or two longer.

APR Calculator

Here is a list of some major costs of buying a new home. This list is by no means exhaustive, but should give you a good idea of the costs involved with your purchase.

  • Loan origination fee. This is associated with every new mortgage loan.
  • Loan points. These are paid in advance in order to get a more competitive interest rate. One point is worth 1 percent of the home's value.
  • Title insurance and title work fees. Buyers need this to ensure that the property's title is properly exchanged so that there is no trouble down the line.
  • Appraisal fees. This ensures that the lender knows that the home is worth its stated value.
  • Inspection fees. An inspection is necessary for a buyer to know that the home does not come with any undisclosed problems.
  • Application fee for Private Mortgage Insurance if you are putting down less than 20 percent.
  • Homeowner's insurance premiums, which are required if mortgage insurance is required and are due before the loan can close.
  • Credit-check fees, which apply to any person whose name will be on the title of the newly purchased property.
  • Any fees for a mortgage broker, real estate agent, or attorney.

What Is An APR Calculator?

mortgage An APR Calculator lets you determine the Annual Percentage Rate for your mortgage. It works by putting in the following information:

  • Loan balance
  • Quoted interest rate (the calculator also allows you to find rates for your area)
  • Payment terms
  • Points
  • Other closing costs

Using this information, the APR Calculator will tabulate the Annual Percentage Rate of interest for your mortgage.

How Can I Use This Information?

Knowing the Annual Percentage Rate for your mortgage is essential for you to understand exactly how much you'll be paying over the life of the loan. As loans vary in terms of interest rates, understanding this figure can also help you decide between several mortgage loans or lenders.

Calculating your Annual Percentage Rate can show you which loans might be most sensible for your individual financial situation. As with any other financial decision, you'll need to do substantial research before committing to a particular mortgage loan.