A new home purchase goes hand in hand with many financial terms you may or may not be familiar with. From escrow to closing costs, here is some real estate vocab you should know as you navigate this process.
Closing Costs – These typically equate to 2% to 5% of the purchase price and encompass such costs as the origination fee, an appraisal, escrow costs, credit report, etc.
Escrow – Your lender will offer you the opportunity to tuck away ear-marked money for your homeowner’s insurance and property taxes. The key benefit of this service is you won’t have to worry about paying these annual bills – your lender will do it for you.
Origination Fee – Once you secure a lender for your mortgage, you will need to pay a fee to get the ball rolling. This is a one-time fee that can sometimes, but not always, be negotiated.
Qualifying – This is a fancy word for “approved” when it comes to your loan. Once you fill out the lengthy application and you qualify for a mortgage, you’ll be able to purchase a home.
Property Taxes – A certainty when you own a home, the amount is set by state and local governments and paid annually or bi-annually. If you have an escrow account, it will be paid directly from there.
We hope we’ve helped you understand some of the lingo that comes with purchasing a home. If you need any help, talk to any of our sales professionals at our Cornerstone Communities model home locations throughout San Diego and Temecula. They will be happy to walk you through the process.