Real estate purchase costs to be reckoned with.

When buying a home, there are a number of other costs added to the price of real estate. Starting from state fees and ending with all expenses related to the mortgage loan. This article will list the additional costs that should be considered when buying a property for EUR 100,000 and using a mortgage loan for the purchase. The main payment is the price of the property itself, which in this case is EUR 100,000. In order to use bank financing, it is necessary to carry out a property valuation. In this case, the valuation of real estate in a new project on the secondary market in Riga costs approximately EUR 150. The costs in banks tend to be different and may differ slightly in each of them. However, it can be considered that the cost of issuing a loan is approximately 1% of the transaction amount, which in this case is EUR 1,000. In order for the transaction to be safe (or if you are buying already mortgaged property with bank financing), an escrow account is also required. Its cost is most often 0.4% of the transaction amount, and when purchasing an apartment worth EUR 100,000, it will cost EUR 400. It should be noted that when purchasing apartments in certain new projects, the developers of which cooperate with specific banks, special discounts are offered for issuing a loan, for an escrow account. Sometimes a free estimate is provided. In this way, you can save significantly, because, as you can see, on average EUR 1,550 is needed for an apartment of a given price for an appraisal, loan preparation and escrow account. If you buy the property from a seller represented by a well-known and reliable real estate agency, you can count on free purchase contract and this sales representative can also help you with other questions related to the purchase. However, if you don’t have a purchase contract for the specific property or you don’t want to trust the document offered by the seller, such a service (drawing up a purchase contract) at a notary can cost from EUR 70 or more, depending on the complexity. Before submitting the documents to the Land Registry, when the agreement with the seller has been concluded, you must go to a notary (orphans’ courts can also provide this service in the regions). It is necessary to create a confirmation request both for the change of owner of the property and for the confirmation of the mortgage in favor of the bank financing the purchase. This service costs approximately EUR 150. If a mortgage loan is not used and a confirmation request for a mortgage is not required, the costs are approximately EUR 70-90. Once the above issues have been resolved, the documents must be submitted to the Land Registry. To do this, you will have to pay 2% of the transaction amount or the cadastral value, if it is higher, for the registration of ownership rights in the Land Registry. So EUR 2000. In addition to this amount, 0.1% of its value must be paid for registering the pledge. If the first payment was 20% of the transaction amount, then 0.1% is calculated from EUR 80,000, which is EUR 80. The office fee for ownership registration and pledge registration is EUR 14.23 and EUR 14.23. So, in this case, EUR 2108.46 is needed to submit the documents to the land registry. If you want to receive the land registry certificate also in paper format, it costs an additional EUR 7.11. In total, purchasing real estate for EUR 100,000 in the described situation requires EUR 103,678.46.

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