Closing costs, such as legal fees, and other one-time expenses associated with the purchase of a home can really add up, and you'll need to factor these costs into your cash-on-hand budget.
Many first time buyers underestimate the amount they will need. Generally speaking, you'll want to budget between 3% and 4% of the purchase price of a resale home to cover closing costs. So, on a home that costs $200,000, your closing costs could run anywhere from $6,000 to $8,000.
Of course, these are estimates — the actual amount you will need could be higher or lower, depending on factors like where you live, the type of home you're buying, or if it's a new construction.
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