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Appraisal Fee - $500
Owner's Title Policy - $3500
Lender's Title Policy - $800
Escrow/Closing fee - $400
Recording Fee - $250
Transfer Tax - $4200
Mortgage Tax - $3000
lender Fee - $1200
CAH Builder Processing Fee - $600
Survey - $250
Capital Contribution - $700
HOA Transfer Fee - $100
CDD Fee - $2500
Total Non-Recurring costs = $18,0000
Prepaid Costs:
Property Tax: $7200
Hazard Insurance : $2000
Total Prepaid Cost: $9200
We are looking at a total of about $27K in closing costs and if we use the builder's preferred lender, they will contribute $7K so we will have to bring $20K to closing.
Does this look in the ballpark? Is there anything we can do to reduce the closing cost?
Prepaids aren't closing costs. 18k on $600k is only 3% so that is about right. Some of those items (capital contribution, transfer fee, survey) are odd for a new build the builder should be paying those and his title insurance. I'm in AZ and we don't do surveys but I would expect they have a good survey already on a new construction home.
Nothing stands out for me. Costs in Florida tend to be higher than other states because Florida has several taxes that kill you. (Depending on transaction you can have multiple taxes like mortgage, transfer, intangible, etc....)
When dealing with a builder, the contracts are oftentimes stacked in their favor. I have no idea what a few of the fees are even for: "CAH Builder Processing Fee", "Capital Contribution" and "CDD Fee". Maybe someone from Florida could enlighten. Junk fees?
Does the builder already own the lot? If so, I would think that they would already have a recent survey.
Wow--there's a mortgage tax in Florida? Also, mortgage rates are likely going up, so you may not be able to count on that rate.
Florida doesn't have a state income tax, so we get hit with all kinds of "taxes" that may not be in other places.
There is an intangible tax on mortgage, and recording fees.
CDD fee may be Community Development District. Cities charge new construction buyers a fee to offset the costs of infrastructure. A new development means, more roads, water, sewer, fire, police, schools, etc. It's typical for a buyer to pay $20,000 - $30,000 that is added to property taxes and spread over 20 years.
Capital contribution is usually from the developer as a payment towards the amenities of the project.
The CAH Builder processing fee may be a junk fee.
The estimate looks pretty typical of new construction.
Florida doesn't have a state income tax, so we get hit with all kinds of "taxes" that may not be in other places.
There is an intangible tax on mortgage, and recording fees.
CDD fee may be Community Development District. Cities charge new construction buyers a fee to offset the costs of infrastructure. A new development means, more roads, water, sewer, fire, police, schools, etc. It's typical for a buyer to pay $20,000 - $30,000 that is added to property taxes and spread over 20 years.
Capital contribution is usually from the developer as a payment towards the amenities of the project.
The CAH Builder processing fee may be a junk fee.
The estimate looks pretty typical of new construction.
Thanks. Now "Capital contribution" and "CDD" make sense. I wish we had development impact fees in Michigan. We get hit with ever-increasing property taxes to subsidize new development here.
Owner Title policy sounds high at $3,500. They have to check to make sure there are no other owners of a home that's not built yet?
The premium is figured based on the purchase price as follows; up to $100,000 = $5.75 per thousand, over $100,000 = $5.00 per thousand (ex: $100,000 = 575.00; $200,000 = $1,075.00). In Florida it varies per county and can be negotiated in the contract.
Owner Title policy sounds high at $3,500. They have to check to make sure there are no other owners of a home that's not built yet?
The premium is figured based on the purchase price as follows; up to $100,000 = $5.75 per thousand, over $100,000 = $5.00 per thousand (ex: $100,000 = 575.00; $200,000 = $1,075.00). In Florida it varies per county and can be negotiated in the contract.
ask the seller/builder to kick in 6% and negotiate the prices down first if you can.
I think it may be the land title search. Which as I am in agreement, should have been previously ascertained by the developer/builder. Fishy fees indeed! Short of going to the county courthouse..To research required fees without the inflated pocket money...You may want to have a non partisan person review it.
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