Posko's are in the hizzy!

Backside, originally uploaded by mposko.

Check out our pictures on flickr of our new house. We signed our lives away Monday April 30th. We're both very excited to have our new sinkhole, I mean house! Right now the kitchen and living area in our apartment is the size of our greatroom in our house, so the extra room is much appreciated.

Closing on a house!

Well,

We are in the process of closing on our house. It's quite amazing all the "fees" in this process.

• Realtors get 6% of the closing costs, which as a buyer we don't directly pay, but indirectly since it's "included" in the selling price anyways. Normally the seller posts the price 10% above market, then the "standard" final negotiating price is -3% from the posting price. So basically the sellers get what they want AND the Realtors are taken care of as well. One exception is if the house has been on the market for a while, then the sellers have to bite the bullet.
• Then there's the whole inspection process. Luckily we had very minor issues with the house, but still $200-400 spent. Which looking at the final price is small, but seriously when is several hundred dollars small.
• Then there's the closing costs. This is my favorite because here's where everyone takes a bit for themselves. Let's see, you have 1%-2% of the selling price for the loan organization fees.
• Then all the other fee's total $4000-$6000. That comes down some based on property taxes due from the sellers, but still you're paying that later anyways.

So let's look at this. Let's say we bought a house for $200,000.

• 6% realtor = 12,000; 2% loan= 4,000; $4,000 fees
• 12,000 + 4,000 + 6,000 = $20,000 of fees.
• The final total would be $208,000 paid, because the realtor's fee is "included".

Let's look at the alternative:

• Pay house off in full (ha ha, yeah right)

So welcome to the real world, I guess. My concern is that does it really take ~$8,000 to prepare a loan? I understand loaning out hundreds of thousands of dollars is not something to take lightly, but in this age of computers I can't believe it is harder to process then 20 years ago.

By the way, we didn't pay any of these amounts as stated, they were just rough numbers thrown out there.

Edit twice for formatting.