So you are finally about to sign the contract on your new home. You probably think it’s safe to assume you know the price terms, since they’re what you offered to pay. You even understand how your real estate agent receives a commission for helping you find your home of choice, because you did your research. Is a doc fee now showing up as an unforeseen part of your home expenses in order to obtain access to your new home’s actual title?
A documentation fee is a price charged higher than and beyond the normal costs of employing a real estate agent and paying the purchase price of the home. You might refer to this as a hidden fee. A real estate agent, on the other hand, would likely refer to it as service fee for getting the appropriate paperwork for the title of your house and other related documents.
There is a huge variance of opinions out there about this fees. Documentation fees are absolutely abhorred by some brokers and these brokers specifically advertise that they do not charge such a fees. Then again, some other agents praise this fees’ existences, citing them as a needed fee for the cost to obtain the relevant documents. This fees are regulated by state government to an amount that is non-negotiable in some states like California. Real estate agents in other states that do not have laws regarding documentation fee regulation are free to set their own amounts, if they want to charge a this fee at all.
A similar and usually more publicized version of this topic comes up during the purchase of a vehicle. You can have even experienced this at a car dealer, since many charge a similar fee in order to create a title to a new automobile for you. In online message forums, this added charge is actually the cause of substantial debate. Lots of people claim the doc fee is a scam to lure buyers into buying an automobile they think costs less than it actually does as a result of a pricey fee added into the back end of the purchase agreement.
Whatever your opinion on doc fees, be sure to do your research before signing your name on the dotted line for any major buy, be it automobile or house. Ask your real estate broker right away whether he or she charges a doc fee. Whether or not your state of residence regulates the use of this fees should also be researched. In the end, doing your homework is essential to a satisfying purchase, no matter how you cut it.