Pillar Guide

Hidden Costs First-Time Buyers Can Avoid

Even before closing, there are costs many first-time buyers don’t anticipate. Budgeting early helps prevent last-minute stress.

Upfront items that add up

Even before closing, there are costs many first-time buyers don’t anticipate. Budgeting early helps prevent last-minute stress.

  • Inspections & re-inspections: General, sewer, roof, and specialty inspections.
  • Appraisal: Required by most lenders; rush fees can apply.
  • Rate lock extensions: If timelines slip, extensions may cost extra.
  • Moving & immediate fixes: New locks, safety items, and essential appliances.

Tip:

Ask your lender for a worst-case fee worksheet and build a small buffer (often 1–2% of price) for unknowns.

Closing costs to watch closely

Closing costs vary by lender and location. Get quotes early and compare line items, not just the advertised rate.

Lender & title fees

  • Origination & underwriting
  • Credit report & flood cert
  • Title search & title insurance
  • Escrow/settlement

Prepaids & escrows

  • Property taxes
  • Homeowner’s insurance
  • Daily interest
  • Mortgage insurance (if applicable)

Review your Loan Estimate and Closing Disclosure side-by-side. Ask your lender to explain any changes.

Ways to offset or reduce costs

  • Ask about lender credits for choosing a slightly higher rate.
  • Compare multiple quotes for title & escrow where allowed.
  • Negotiate seller credits to cover some closing costs (market-dependent).
  • Explore first-time buyer programs and down-payment assistance in your area.

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*Informational only; not legal, tax, or financial advice. Program availability and credits vary by market, lender, and contract terms.