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Buyer closing costs can be a unwelcome surprise if your buying a home for the first time, and have not been through the home buying process yet. Buyer closing costs are those home buying costs imposed on you by your lender when it comes time to close on your new home. So, not only are you responsible for a large down payment, but you’ll have the dreaded out of pocket buyer closing cost expenses. Not all of your closing costs are legit, however. Many lenders utilize the closing cost process to make additional profits from you. That is why you’ll want to go over all buyer closing costs with your lender. Have your lender explain the reasoning behind these costs. At that time you can ask for the removal of any questionable charges. This is a very important step; otherwise your lender will take advantage of you if you don’t look out for yourself.

One buyer closing cost that is not avoidable is the dreaded property tax. The property tax has been a main staple of our local governments for a long time. Property tax revenue goes to support fire departments, our schools and many more municipal needs. Unfortunately, it is quite painful when we are required to pay it. It’s one of those things that we just need to accept. One way to handle affording the property tax is to spread the taxes out, avoiding a large lump sum property tax bill. This can be done by having the property tax included in your mortgage ecrow account. This allows you to include your property tax in your monthly housing bill, so your not surprised with a huge tax bill at year-end.

Another expense that comes with home ownership is homeowners insurance. Homeowners insurance is an absolute must if you own a home. Homeowners insurance will protect your possessions, your family and any visitors. It’s simply careless not to have homeowners insurance to protect what is probably your largest investment; your house. Homeowners insurance will protect you in the event of theft, some natural disasters, and liability issues. It’s important to realize that if you live in an area prone to earthquake or flood it’s necessary buy additional coverage. Most homeowners insurance policies don’t protect for such natural disasters. We include it as a buyer closing cost issue because it is required by lenders, as it should be.