Planning to buy my 1st place..what costs to expect? (Philadelphia: short sales, foreclosures)

[MrSaturdayNight]

Hi people
So im currently saving up to buy my first place (condo/townhome) soon in the philadelphia-ish area. I am new with this whole process as I will be a first time brand new homeowner. I was wondering if anyone can fill me in on what upfront costs as well as monthly costs to expect with owning a home. Here is what I know so far:
1. Downpayment (im hoping to save for up to 20%)
2. Closing costs? (what does that typically run?)
3. Mortgage obviously
4. HOA/Condo fee (what does that typically run per month?)
5. Property tax (how much to expect to pay for a place in PA each month?)

Im sure im missing more monthly costs an taxes..can anyone clue me in please..thanks in advance!

[MrSaturdayNight]

Hi....heres a little more information to help.

Im looking to buy a place more in the suburb areas surrounding philly but close to the city and possibly even the south jersey area (depending on if property tax there is much more)

My price range is between 200-300K and im looking for a 2-3 bedroom condo/townhome.

Amenties are not that important..a pool may be nice but not necessary.

Thanks again

[Wisertime]

I am in the process of buying from out of state myself, so here is what I have found out.

-PA has a transfer tax on the sale (2% suburbs 4% in the city). Typically split between buyer/seller.
-Title insurance runs about $1700+ in that price range
-Taxes vary from city to suburbs (subs being much higher) 1-4% approx
-On top of that you have to pay a years worth upfront!
-Loan origination fees are about 1% of sales price
-Tack on junk fees of another $1000
-Expect to pay 3 mos upfront local taxes/Homeowners insurance too
-Home inspection $300-500
-HOA's are expensive w/condos I've seen. Rows/towns prob won't have them in older neighborhoods
-See if you qualify for the $8000k rebate

If you put down 20% you can probably expect to tack on another 10-20% in closing fees, but you can try to get seller assist to reduce to out of pocket expenses.

If you itemize your taxes, you will get about half of what you pay in taxes back probably vs. not itemizing when all is said and done.

I'm sure I left some things out. PA has some quirky laws/practices.

IMO it really doesn't pay to buy unless you plan to stay there for 4-5 years at a minimum.

[PeeAye Native]

Search for "good faith estimate" and PA closing costs.

Better yet, there are some adult education/evening classes that are put on in the area, and they usually offer a four or five night class (one night for five weeks) named something like "What to expect when buying your first house", or "The Home Buying process".

Here is one place that offers the courses: Main Line School Night - 500+ Day, Evening and Weekend Classes
Update: I see they do not offer such a course this spring, ... call them to ask about one in the fall session.

Also, if you do this, be sure you don't fall into something that that a sly RE agent has setup thinly disguised as a "seminar" or an "information session" just to pitch to you his or her services, be sure anything covers these topics:

- Terminology and Sales Contract. Types of sales (Listed, FSBO, short sales, foreclosures, tax sales, etc.)
- How to choose an agent, how Agency works in PA (buyers agent, sellers agent and agency relationships, contractual commitments).
- Title Insurance, Settlement Process, Legal Review (i.e., hiring a RE attorney).
- Home Inspections, how to determine the condition of your potential new home or condo.
- Mortgage types, how to shop around, Qualifying, credit reports, the mortgage process.

It is a good sign if a different 'speaker' comes in for each topic, such as an actual accredited Home Inspector talks about the Home Inspection process, a Mortgage Broker talks about the Mortgage process, a Title Insurance guy comes in for the title insurance session, a RE Attorney talks about the legal representation parts. The Main Line School Night courses do this.

Home buying is a situation where the more you know the better off you are. Example: You're working with an agent ( a buyer's agent) and he/she says "Oh, I have a 'friend' who does title insurance/home inspections/brokers mortgages, ... give him/her a call". This *may be*, and usually is, a hint that for every ten people the agent refers to the so called 'friend', the agent gets a free trip to Las Vegas or Disney World. Do you want someone who is working in your best interest, or your agent's best interest? The more you know about how it all works the better off you are.

[kimrocktherealtor]

PeeAye - Actually thats HIGHLY illegal for the agent to get kickbacks without disclosing it to a client and if it ever happened that agent would lose his or her license. So honestly, that really doesnt happen as often as you may think. A lot of agents have mortgage brokers/title companies they prefer to work with because they have a good working relationship and they get the job done well and on time, and therefore it makes the transaction go more smoothly for the agent and of course their client (you, the buyer).

[solibs]

In Philadelphia the buyer typically pays 10% of the sale price in closing costs.

It's great if you have 20% to put down on your house but really, with interest rates what they are it doesn't make sense to put that much down on a $200k condo. Especially if you have any other, higher interest debt.

FHA is 3% down for first-time buyers, you can do up to 6% sellers-assist, no PMI, etc. I would look carefully into how much you're actually saving month-to-month by putting 20% down vs. 10% down.

Young, single guy buying his first house? Take 10% and hide it in something with a good return. You'll need it for your wedding.