You don't have to be caught off guard by home closing costs in Fairfax VA. Read on to learn how you can save money on these charges. Don't forget to buy title insurance and pest inspection before closing on your new home. These fees can add up quickly! So be sure to understand escrow and prepaid interest to get the most out of your closing costs.
Save money on home closing costs
There are ways to save money on home closing costs in Fairfax VA. These fees cover everything from realtor fees and property taxes to the lender's fees. In addition to these costs, you may also have to pay some upfront housing expenses. While transfer and recording taxes are nonnegotiable, you can negotiate on the lender's fees. Sometimes, the seller of the home will cover some of these costs, as well.
If the cost of a title company is higher than your expected, negotiate with your buyer to get the closing costs covered by the buyer. Some real estate agents are willing to work out lower fees for their clients, and if the buyer is willing to pay those, they may be able to lower their closing costs as well. Another way to save money on home closing costs in Fairfax VA is to negotiate with your realtor for a lower commission.
Understand escrow and prepaid interest
Closing costs are the most confusing part of the real estate transaction in Fairfax County, VA. Closing costs include fees for the real estate agent and attorney, title insurance, and recording fees. Buyers and sellers share these costs equally. Listed below are some of the most common costs that buyers and sellers must pay during the real estate transaction. Before you buy a home in Fairfax VA, make sure you understand these costs.
Escrow and prepaid interest are both related but should be understood before closing. These costs are calculated based on the number of days between closing and the end of the month. If you can, schedule your closing date to be at the end of the month. This will lower the total amount you'll need at closing. Escrow is the last prepaid cost you'll pay before closing. Typically, you'll deposit two months of property taxes and homeowners insurance to the escrow account. The money will then be used to pay these future bills.
Buy title insurance before closing on a VA loan
Before closing on a VA loan in Fairfax and surrounding areas, you should purchase title insurance. If you don't, you could end up with a nightmare after closing. Title issues are expensive and can lead to a legal battle. In addition to title insurance premiums, you should also consider a discount point purchase to lower interest rates. These points are equal to 1% of the loan amount. However, they are not common among VA loan buyers. Finally, you should be aware of fees incurred by lenders for accessing credit information. The VA limits such fees to $50.
If you're a first-time homebuyer, you'll most likely encounter new terms, including "title insurance." For example, you'll likely hear that a clear title is required when you apply for a VA loan. But what does that mean? A "clear title" means the property doesn't have any issues affecting its title. Such problems could cause financial trouble for the lender and the new owner.
Getting a pest inspection before closing on a VA loan
A termite inspection is a requirement for many mortgage lenders, and if you are getting a VA loan, you need to ensure that the home is free of infestation before you close on your loan. Termites cause havoc with houses, damaging up to 600,000 homes each year and costing homeowners over $5 billion a year. It is for this reason that many mortgage lenders require pest inspections before you close on your loan, and the U.S. Department of Veterans Affairs (VA) offers a comprehensive list of pest inspection requirements for VA loans.
Some mortgage and real estate professionals believe that getting a pest inspection before closing on your VA loan is against the VA's rules and regulations. However, you don't have to be a Veteran to get one before closing on your loan. You can pay for it yourself or even get your lender or realtor to pay for it. The pest inspection company will evaluate all parts of the house that are accessible to you, and will look for visible signs of infestation.