Hidden Costs While Buying a Home

Buying a home of your own brings with it feelings of euphoria, joy and pride. However, during the process of negotiation, you need to be very vigilant and find out all other hidden charges other than the down payment and monthly EMIs. Here’s a look at some of these mysterious charges that might start popping up once you have signed the agreement:

Location

As always, preferential location is key to sudden increases in charges within the same project. Homes with a view come at higher costs than those without. Lakefront or pool view villas come at premium costs that maybe 5-10% higher than other homes within the same complex.

Processing Fee

Your home loan also comes with a processing fee that covers the administrative cost of processing the loan. With different banks offering varying processing rates, it’s essential you choose a bank with lower processing fees.

Brokerage Charges

If you are purchasing your home through a broker, then remember to factor in their fees too. It’s usually 1-3% of the total cost of the new home. With premium homes, this can turn out to be a lot!

Maintenance Deposit

Many builders demand an advanced maintenance deposit for a period that can range from 2-10 years in some cases. Some builders demand this fee even before completion of the building to have a stable inflow of funds. It’s usually calculated on square-footage of built-up area.

Parking Space Fee

The parking space for your vehicle comes at an additional cost and increases further if you own more than one car. However, this fee is restricted to apartment homes and doesn’t include villas.

Registration and Stamp Duty

This is another hefty charge that is easily overlooked when planning your budget. It comes at a rate of 5-7% of the total cost of your new home and can include a lawyer fee too (1-2%). The lawyer does the stamp duty paperwork and ensures that the builder has provided all the necessary approvals and certifications.

GST

If your home is a new launch or under-construction, you will have to pay GST taxes too, which amount to a neat sum.

Interior Designing

While this cost can vary depending on your unique needs, most enlightened people these days prefer the touch of professional designers when it comes to their new homes’ interiors.

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