Costs Before Closing
May 17, 2016
I thought it might be helpful to any future flippers out there to share with you the expenses we’ve already encountered before even closing on our home.
In other words, the money we’ve spent on something that’s not even ours yet.
The first expense was earnest money to the title company. Part of that whole we’re not backing out thing.
Then we paid for a home inspection. This was optional because the offer was not contingent on getting a home inspection, and we knew we’d be going through with the sale regardless of inspection results. However, it gives us a nice “to-do” list to start planning (and we ARE planners).
Next we paid for a 6 month homeowners policy on the property. Will we be done in 6 months? Let’s say yes. Let’s say it a lot. And it will come true.
Then we visited the water company to get the water turned on, where we had a deposit and a ‘turn on fee’ to pay.
We scheduled a wire transfer for the funds for the actual purchase. Our bank charges a small service fee to do this.
And we just found out the doorknobs and deadbolts on the house belong to HUD…so we need to put new door knobs and deadbolts on the house immediately after closing! This will be our very first alteration to the house (whoop-dee-doo, right?). But that meant I got to zip over to Menards for some new door knobs and locks…and spent twenty minutes there mentally debating the aesthetic benefits of various finishes. Because, you know, this will determine the metal finish of everything in the ENTIRE FLIP! So right up front I am making a design decision (cue angelic voices singing). It was glorious. (I’m not joking — you think I’m joking – but I’m not!)
Money Spent:
$1,001 title company
$349 home inspection
$625 homeowners policy
$110 water turned on
$20 wire transfer fee
$55 locks and knobs
Total: $2160
That’s a substantial little chunk of change for something that isn’t even ours yet! So much for my misguided thought that “the house doesn’t cost anything until we sign the papers.”
And now we’re paying for things that will cost us more the longer we have the house, so the clock is ticking! Let’s sign those papers already!
