In considering the affordability of your Berkeley home, you tend to focus on the sale price, and then the calculated monthly mortgage payment.  While this is perfectly normal, it is important to be aware of other, unexpected costs that will occur as you move towards finalizing the purchase.  Money should be set aside to cover whatever may develop. While not all of these things will apply to your situation, you should be aware of them as possibilities.  Additionally, some of these costs and fees are often negotiated between the buyer and seller, so not all will apply to the buyer, only. Here is a good summary:

a. Professional Home Inspection Fees: It is a wise idea to pay for and have the home thoroughly inspected before making the final purchase.  Costs vary among areas, but they are usually under $1000.00.  If there are structural issues or mold or termite problems, there may be extra inspections required.

b. Appraisal Fee: You most likely will be required to pay this fee in order to obtain your loan.  This are usually under $1000.00 as well.

c. Additional Closing Costs: Although you will be given a Good Faith Estimate of Closing Costs after you submit your loan application, these are projected costs, so do not count on them being the final numbers.  Have extra funds set aside in anticipation of additional fees.

d. Move In Costs:  Most homes will require you to fix up things to fit your own particular needs.  Projected costs could include fees for upgrading plumbing, installing kitchen counter tops, replacing shower stalls, structural strengthening, renovating closets, basements, painting, etc..   You should make a list of the most essential things that must be done to make the home ready, and include these costs in your purchase plans.

e. Large Appliance Purchases:  If the home you are buying is older, you may need to upgrade the kitchen appliances by purchasing a stove or refrigerator.  You might also need a washer and dryer.  It makes more sense to install them before you move in, especially if you are renovating the kitchen or bathroom. Add this to your planned expenses.

 f. The Little Things: These are truly the unexpected expenses.  They would include new lamps, mirrors, hardware for a garage door, pulls for the kitchen, and decorative additions to make the rooms more pleasing. Because they are small, they are often overlooked, even though in some cases, they are quite essential. 

While this seems a lot, once you take the time to develop a plan, the cost to move will seem much more pleasant and efficient, with few surprises.

Posted by Bruce Wagg on


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