Fees and Expenses to Expect When Taking Out a Mortgage

Your mortgage comes with various fees when you take out one. These fees help cover the expenses and costs of applying for the loan, transferring the property to you, and others. It is important to be aware of these costs, as you have to shoulder these on top of your mortgage.

In this article, we will share with you a list of some of the most common fees and expenses that you can expect when you take out a mortgage. Knowing what these are will help you prepare and save up for them beforehand. These include:

  1. Application Fees and Expenses. Yes, you already have to shell out money even when you are just applying for a mortgage. Aside from the application fee that your lender might require, other expenses you can expect at this stage include: expenses for your legal contract, the property title, and credit check.
  2. Mortgage Fees. Once you have taken out a mortgage, expect to pay fees as well. This covers everything from your property valuation to your stamp duties. You might have to pay any or all of the following: lenders mortgage insurance (if you cannot make a 20% down payment on the property's purchase price), mortgage registration, property valuation, stamp duty, and mortgage establishment fees.
  3. Property Expenses. Whether you are buying a brand new or an old property, you may also have to spend money as soon as you move in. Your expenses would usually include maintenance, utilities, insurance, stamp duties, legal fees, and insurance. Depending on the type of expense, these are meant to formalize the transfer of the property to you and help you maintain it. You might also have to renovate or fix it up if it is an old property. The amount of work it needs depends on the condition of the property. It therefore helps to choose one that's easy to fix. The same thing applies for an investment property. You might want to replace the taps and light fixtures to update the interior, as well as repaint walls, doors, and fences.

But before you take out a mortgage, it pays to check out your options first. At Rate Detective, our qualified advisors are ready to provide you with rate comparisons of Australia's top lenders based on your personal circumstances. This enables you to find a deal that truly meets your needs and budget.

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Published on November 11-th, 2012 in Home Loans
Damon Rasheed is the CEO of Rate Detective, an Australian financial service comparison sites specialising in Life Insurance, Income Protection Insurance and home loans. Damon holds a Master's Degree in Economics from the University of Melbourne and has been involved in many start-up internet businesses.
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