With tax season just behind most Americans, this is possibly the time of year where consumers’ personal financial reality is most clear. Individuals’ personal tax returns or payouts can affect their budding dreams of home ownership this spring home buying season. The experts at Coldwell Banker® Mortgage offer a new reality check by outlining down payment options and providing a check list on other possible costs associated with buying a home.

First, most lenders request a down payment of at least 20 percent of the cost of the house. For some people, saving this amount of cash can be difficult to achieve, especially if unexpected costs come up such as tax pay outs. However, home ownership is still possible as several programs are available which allow buyers to make down payments significantly less than 20 percent of the price of the home.

Particularly relevant for first time buyers and for those who haven’t been in the market for some time, additional dollars should be saved for an estimated range from 1 to 3 percent of the value of the home for “out of pocket” or additional closing costs. Closing costs vary from state-to-state, city-to-city and even from home-to-home. Some examples of national averages include tax services which can run an approximate $85.00, credit reports for approximately $20, and appraisals for approximately $350. Closing costs can also include fees relating to attorney time, home inspections, title searches, bank fees, and termite, flood or radon inspections to name a few. The mortgage lender requires some of these services and others are legally necessary depending on where the buyer lives. While not a requirement, extra dollars can be wisely spent if earmarked toward a home warranty which guarantees the appliances and inner workings of a home for the first year it is owned.

Consumers can further evaluate their options in down payments and balance them against some predicted closing costs directly with the Coldwell Banker Mortgage program or their lender. With the alternative being renting, consumers are wise to understand their options since owning a home would literally and figuratively may be a possible tax shelter in and of itself.


Financing provided by Coldwell Banker Mortgage, 3000 Leadenhall Road, Mt. Laurel, NJ 08054. Please note: Not Authorized to lend in the following states: Montana and Virginia. Arizona Residential Mortgage Licensee #BK BR 0102236, Licensed by the Department of Corporations under the California Residential Mortgage Lending Act; Georgia Residential Mortgage Licensee, Illinois Residential Mortgage Licensee; Massachusetts Licensed Lender #ML1774; Minnesota - This is not an offer to enter an interest rate lock-in agreement. New Hampshire First Mortgage Banker #5625-MB & Second Mortgage Home Lender #5626-MHL; Licensed by the N.J. Department of Banking and Insurance; Licensed Mortgage Banker - NYS Banking Department, Licensed First Mortgage Banker and Secondary Mortgage Lender by Pennsylvania Department of Banking; Rhode Island Licensed Lender. Coldwell Banker Mortgage is an Equal Housing Lender. Coldwell Banker(R) Mortgage(SM); (R) and (SM) are trademarks licensed to Coldwell Banker Real Estate Corporation.

Note:
Always consult a qualified and licensed Realtor®.  Shopping and learning about home ownership on the internet is good, but it does not replace the experience of a licensed Realtor® when purchasing your property.