Cost-cutting in real estate transactions involves negotiating fees, choosing flat fees rather than hourly rates, and selecting an attorney with excellent client reviews. Furthermore, planning ahead for closing expenses can save money as well.
Top one-time closing costs in NYC and NY state include transfer taxes and sponsor attorneys’ fees for new construction condos.
Title Insurance
Title insurance protects buyers against defects in legal ownership that might remain undetected during purchase and is typically payable one time at closing.
New York buyers typically pay both owner’s and lender’s title insurance policies; your real estate agent can advise on local procedures.
Your title company should provide an itemized list of fees at closing that matches up with those listed on your Loan Estimate and Closing Disclosure, otherwise shop around to find a better price. A few minutes of research could save hundreds or even thousands in hidden charges; giving you more money for home improvements like paint or furniture!
Tax Escrow
One reason home buyer closing costs vary so widely by region is due to real estate transfer taxes levied by each state for legality checks of each transfer transaction.
Home buyers typically make arrangements at closing to deposit property taxes and homeowner insurance premiums into an escrow account so as to avoid making large lump sum payments twice annually.
Sellers typically pay their share of these fees, as well. While some charges may be negotiable, others must remain non-negotiable. On average, closing costs for sellers typically range between 8%-10% of the home’s sale price; this figure includes both agent commission and seller fees.
Document Preparation
Closing costs can vary widely depending on your lender and location. To prevent being caught off-guard on closing day with unexpected charges that weren’t anticipated, take an inventory of all forms and fees you need to submit prior to closing date so as to be prepared.
Your lender will present and require that you sign a loan package which includes your mortgage agreement, property tax statements and any additional documents related to your purchase. They may also charge a fee for their attorney preparing final paperwork at closing.
Other fees to consider when purchasing a property may include survey fees, homeowners association transfer fees and private mortgage insurance (PMI), which typically requires monthly payments but some lenders require upfront payments at closing.
Appraisal
Homeowners can reduce closing costs significantly by negotiating real estate agent and attorney fees and selecting an attorney who offers flat fees for certain tasks.
Home appraisals are frequently required by mortgage lenders prior to approving loans on new properties, with fees often ranging from several hundred dollars up to several thousand.
Buyers can save on closing costs by asking their real estate agents for an appraisal rebate and exploring Prevu’s industry-leading Smart Buyer program. Sellers can reduce closing costs by carefully reviewing their contract and hiring an experienced, specialized attorney with excellent client reviews; moreover, transparency in billing will keep attorney costs at a minimum.
Lawyer Fees
If you want to save money, be sure to compare attorney fees before making your choice. Real estate attorneys typically welcome conversations about rates and can offer both hourly and flat fee options – flat fees being an effective way of controlling costs as they’re more predictable and provide clarity regarding what services are covered by each service provider.
Purchases in New York City can be costly, but you can minimize legal expenses by being proactive and carefully reviewing the closing cost disclosure. When selecting attorneys, look for those that provide transparent billing practices and have great client reviews in order to avoid surprises down the line. When possible, find someone experienced who can oversee all aspects of the transaction in order to keep legal costs manageable.
