Unfortunately, when buying a house it’s not just as simple as getting a mortgage, paying your deposit and moving in. There are a few fees that buyers might forget to include in their budget when purchasing a home.
One of the heftiest fees applicable when buying a home is stamp duty. First home buyers in Victoria can take advantage of the First Home Buyers scheme and you won’t need to worry, however, if this is your second home, you must remember that the amount of stamp duty you owe will be relative to what you pay for the house. On average, for a $500,000 home you’ll be looking at about $23,000 in stamp duty cost, so factoring that into your budget is a must.
Conveyancing and Legal Fees
This fee is for the drawing up of your vendor’s statement and all the paperwork needed when buying a home. You can do these yourself, but little mistakes will end up costing you a lot more money than you thought it could. These cover the overseeing of the mortgage and the change of title while also covering the exchanging of finances during the sale.
Building and Pest Inspections Pre Sale
They might sound like a hassle, but they could save you in the long run. It’s another cost that is hidden away but it’s one that you shouldn’t forget about, although some choose to. It will make sure the home is in good condition before you take over the title. You’ll be happy you wore the cost if they discover any evidence of termites or damage from other pests.
LMI (Lenders Mortgage Insurance)
LMI is where the bank adds an extra expense to your home loan that covers them when you have 20% or less deposit on a home loan. As a smaller deposit means a higher risk for the lender, they charge a fee to allow you to complete the loan with them. It can vary depending on the deposit you front up with.
Home, contents, the lot. When you take over the title you want to be assured your assets are safe and insured, which is a cost that is again on top of the other fees that come with purchasing a property. These all come at a cost and are often forgotten, but are also often necessary to assure that when you purchase your property, you are fully covered and have a hassle free settlement.