Factors in Your South Carolina Mortgage Payment
South Carolina comes with more than just Southern charm. In fact, you’ll find the sixth-lowest property tax rate in the country here, with an average effective rate of just 0.52%. However, that only applies to primary residences. Commercial and those who own second homes may not find as large of savings.
You home will be appraised once every five years to determine full market value. Your actual property tax will be based on a percentage of the market value, known as the assessed value. Owner-occupied primary residences have a ratio of 4%, while second homes have a rate of 6%. Let’s say your home’s appraised at $200,000 for full market value. If you live there full time, tax rates would apply to the assessed value of $8,000 ($200,000 x 0.04%). Your actual property tax rate will depend on the county your home is in.
Another ongoing cost you’ll pay along with mortgage and property taxes is homeowners insurance. South Carolina has some of the more expensive rates in the U.S., with an average annual premium of $2,335, according to data from insurance.com. While homeowners insurance usually covers theft, smoke damage, lightning and more, it generally doesn’t cover flood damage, which is a concern for this coastal state.
According to Insurance Information Institute data from 2021, South Carolina has one of the highest risks for storm surge flooding, as it ranks seventh in the U.S. for total number of homes with exposure to damage. In addition, about 30% of South Carolina homes are coastal, which adds to the risk. Homeowners in this state are highly encouraged to buy flood insurance, which can be secured through the National Flood Insurance Program (NFIP) that's run by FEMA.
South Carolina has what’s called the Beach Plan or Wind Pool, through the South Carolina Wind and Hail Underwriting Association (SCWHUA). It’s the market of last resort for homeowners in coastal areas who can’t obtain a policy through the standard insurance market. A policy through SCWHUA provides wind and hail damage insurance.
A financial advisor can help you understand how homeownership fits into your overall financial goals. Financial advisors can also help with investing and financial planning - including retirement, taxes, insurance and more - to make sure you are preparing for the future.
Costs to Expect When Buying a Home in South Carolina
Taking a step back, before homeownership, you’ll want to set aside money for the numerous one-time costs that accompany the home-buying process. One of the first costs is a home inspection, which will generally run between $200 and $450, depending on the square footage of the home. Standard home inspections generally cover the structure, plumbing, electrical and more. The price goes up if you add any extras, such as mold testing, radon testing or a termite inspection.
If you end up finalizing the purchase contract, you’ll set a closing date with your lender. On that day, you’ll sign a number of documents, as well as pay a few fees, which are known as closing costs. South Carolina’s closing costs average 1.66% to 4.94% of a home's value, with this variance depending on a number of factors, including location, services used and lender.
Average Closing Costs by County
| County | Avg. Closing Costs | Median Home Value | Closing Costs as % of Home Value |
|---|
| Abbeville | $3,067 | $90,800 | 3.38% |
| Aiken | $3,879 | $147,300 | 2.63% |
| Allendale | $2,429 | $49,200 | 4.94% |
| Anderson | $3,868 | $145,800 | 2.65% |
| Bamberg | $2,830 | $75,400 | 3.75% |
| Barnwell | $2,930 | $81,900 | 3.58% |
| Beaufort | $5,047 | $298,100 | 1.69% |
| Berkeley | $4,155 | $185,500 | 2.24% |
| Calhoun | $3,573 | $107,200 | 3.33% |
| Charleston | $5,251 | $315,600 | 1.66% |
| Cherokee | $3,527 | $101,500 | 3.47% |
| Chester | $3,140 | $95,600 | 3.28% |
| Chesterfield | $2,924 | $81,500 | 3.59% |
| Clarendon | $3,531 | $102,000 | 3.46% |
| Colleton | $3,061 | $90,400 | 3.39% |
| Darlington | $3,094 | $92,600 | 3.34% |
| Dillon | $2,890 | $79,300 | 3.64% |
| Dorchester | $4,252 | $198,800 | 2.14% |
| Edgefield | $3,748 | $129,300 | 2.90% |
| Fairfield | $3,539 | $103,000 | 3.44% |
| Florence | $3,767 | $131,900 | 2.86% |
| Georgetown | $4,179 | $188,800 | 2.21% |
| Greenville | $4,143 | $183,800 | 2.25% |
| Greenwood | $3,699 | $122,800 | 3.01% |
| Hampton | $2,783 | $72,300 | 3.85% |
| Horry | $4,126 | $181,500 | 2.27% |
| Jasper | $4,016 | $166,200 | 2.42% |
| Kershaw | $3,761 | $131,100 | 2.87% |
| Lancaster | $4,259 | $199,800 | 2.13% |
| Laurens | $3,524 | $101,200 | 3.48% |
| Lee | $2,883 | $78,800 | 3.66% |
| Lexington | $3,949 | $157,000 | 2.52% |
| Marion | $2,850 | $76,700 | 3.72% |
| Marlboro | $2,709 | $67,500 | 4.01% |
| McCormick | $3,648 | $116,500 | 3.13% |
| Newberry | $3,647 | $116,300 | 3.14% |
| Oconee | $3,969 | $159,800 | 2.48% |
| Orangeburg | $3,096 | $92,700 | 3.34% |
| Pickens | $3,882 | $147,700 | 2.63% |
| Richland | $3,993 | $163,100 | 2.45% |
| Saluda | $3,584 | $108,600 | 3.30% |
| Spartanburg | $3,836 | $141,400 | 2.71% |
| Sumter | $3,642 | $115,700 | 3.15% |
| Union | $2,901 | $80,000 | 3.63% |
| Williamsburg | $2,722 | $68,300 | 3.98% |
| York | $4,345 | $201,100 | 2.16% |
Our Closing Costs Study assumed a 30-year fixed-rate mortgage with a 20% down payment on each county’s median home value. We considered all applicable closing costs, including the mortgage tax, transfer tax and both fixed and variable fees. Once we calculated the typical closing costs in each county we divided that figure by the county’s median home value to find the closing costs as a percentage of home value figure. Sources include the U.S. Census Bureau, Bankrate and government websites.
Closing costs break down into individual fees. Your mortgage lender charges origination fees. This includes items such as tax service, processing, funding fee, commitment fee, document preparation, origin points and underwriting. Now, not all of these costs are applicable for all loans, and most lenders charge different prices for services, so it’s not a standard flat fee. You can shop around if you’re still in the early stages of home buying to see how much each lender charges for its services.
The next set of fees will be split among those were involved in the process, and can be thought of as third-party fees. This can include appraisal costs, attorney fees, credit reports, flood certification and survey costs. Your total depends on which services you choose to use.
Title insurance is another one-time cost. This type of insurance protects you against errors in public record, defects on the title or undisclosed heirs. A title policy will defend your title in courts or pay for your loss in the event of an unsuccessful defense. The lender generally requires a policy up to the amount of the loan. Borrowers can buy an owner’s policy on the full purchase price. It’s highly recommended, and you’re covered as long as you maintain ownership of the home.
One last cost is the South Carolina deed recording fee, which is usually paid by the seller. This charge is $1.85 per $500 of the home’s purchase price to the state, $0.55 per $500 to the county and $1.30 per $500 to the state. The fee is collected at closing and sent to the county’s court clerk or register of deeds.
Details of South Carolina Housing Market
South Carolina, home of Fort Sumter where the first battle of the Civil War took place, is known for its beaches and history. Myrtle Beach, Hilton Head and Isle of Palms can all be found in the Palmetto State. With about 5.2 million residents according to Census Bureau estimates, it’s also the 23rd-most populous state.
This small, southeastern state is the 40th largest by land area and has 187 miles of coastline. South Carolina’s most populous cities are Columbia, Charleston, North Charleston, Mount Pleasant, Rock Hill and Greenville. Mount Pleasant and North Charleston, situated on the coastline, are suburbs of Charleston.
As a whole, South Carolina’s median home value is $213,500, according to recent Census data. The state ranks towards the middle of the pack in SmartAsset’s Healthiest Housing Markets study, which looked at stability, risk, ease of sale and affordability. According to NeighborhoodScout, the cities with the highest appreciation rates in South Carolina since 2000 are Sullivan's Island, Daufuskie Island, Mount Pleasant and McClellanville, all of which are located along the coast.
Hoping to buy a home in one of South Carolina’s cities? Charleston’s median home value is $369,500, according to recent Census data. If you move inland to Columbia, the state capital, median home values decrease to $193,100. Rock Hill, to the north, falls lower, with a median home value of $187,000.
Local Economic Factors in South Carolina
Major industries in South Carolina are trade and transportation, government, business services and education and health, according to the South Carolina Chamber of Commerce. Top employers, according to Newsmax, included Greenville Memorial Hospital, the Medical University of South Carolina, and BMW Manufacturing.
Personal income doesn’t fare well in South Carolina. In 2021, the state's $52,467 per capita personal income (PCPI) ranked near the bottom of the U.S., according to the U.S. Bureau of Economic Analysis. The national average, on the other hand, is $65,148. However, unemployment in December 2022 was 3.3% compared to the national rate of 3.5%, according to the Bureau of Labor Statistics.
While property taxes in the Palmetto State are some of the lowest in the country, you won’t find the same savings with income tax. South Carolina has marginal tax rates based on income brackets. The more money you earn, the higher your tax rate. There’s also a 6% state sales tax, which is about the average rate across the U.S. In addition to the statewide sales tax, some counties elect to have a local option tax of an additional 1% to 3%. Capital gains are also taxed by South Carolina on two different levels: short-term and long-term.
Planning your move to this sunny southeastern state? Or perhaps you're considering retiring in South Carolina? You might want to compare your South Carolina paycheck with your current pay to get an idea of how far your money might go. Or, you could get more specific and compare the cost of living between your current hometown and your future one.
Let’s say you’re moving from Atlanta, Georgia to Charleston, South Carolina and your household income is $65,000. The average cost of living is 1% higher in South Carolina due to housing and food. A move from Portland, Oregon to Columbia, South Carolina would lower average costs by 3% due to cheaper housing, taxes and food costs. Boston, Massachusetts to Hilton Head, South Carolina, a popular resort town, would equal a 16% lower cost of living on average.
Mortgage Legal Issues in South Carolina
South Carolina has relatively protective laws for home buyers. The state requires sellers’ disclosures, under the South Carolina Residential Property Condition Disclosure Act. While the actual seller’s disclosure is only five pages long, the requirement is actually backed by law, which is more than what many other states have. The document can help home buyers get a general sense of the home condition, but is no substitute for home inspections and due diligence on the buyer’s behalf.
As for foreclosure, unlike North Carolina, South Carolina uses mostly judicial foreclosure proceedings, which means the court is involved. The foreclosure process begins when you fall behind payments and fail to respond to your lender’s notices or mediation. Most states, including South Carolina, offer foreclosure counselors who can offer you advice and help if you’re in danger of falling behind on your loan, or have already missed several payments.
For most judicial foreclosures, the next step for the homeowner is receiving a foreclosure summons and complaint. In South Carolina, you usually have 30 days to respond to the notice. During this time, you can hire a licensed attorney experienced in foreclosure law to help you with the proceedings. If you file a response to the summons, you and/or your attorney have the opportunity to present your position at the hearing. At the hearing, the judge can set a sale date (when your house goes to auction), or other actions depending on what’s determined.
In South Carolina If the house is sold at auction, there is no buy back period after the sale for the original homeowner, known as the right of redemption. The state also allows lenders to seek a deficiency from a borrower. This means if the house sells at auction for less than the amount owed on the loan, the lender can try to get the remainder from the borrower with a deficiency judgement.
South Carolina Mortgage Resources
Available Resources
| Resource | Problem or Issue | Who Qualifies |
|---|
| South Carolina Housing Finance Authority | Provides affordable loans and down payment assistance for South Carolina buyers. | First-time, repeat and military homebuyers who fit the qualifications. |
| USDA Rural Development - Single family loans | Offers payment assistance to increase an applicant’s repayment ability. | Applicants must be without decent, safe and sanitary housing; Be unable to obtain a loan from other resources on terms and conditions that can reasonably be expected to meet; Agree to occupy the property as your primary residence; Have the legal capacity to incur a loan obligation; Meet citizenship or eligible noncitizen requirements; Not be suspended or debarred from participation in federal programs. |
If you’re looking for state homebuyer resources, start with the South Carolina State Housing Finance and Development Authority. You’ll find first-time home buyer programs, education, mortgage tax credit information and more. The agency, nicknamed SC Housing for short, offers comprehensive programs to address almost all housing needs: rental, homeowners and home buyers.
South Carolina has plenty of property eligible for USDA loans if you’re a homebuyer with low to moderate income. You can see if you fit the income criteria and whether the home is in an eligible rural area via the USDA website.
Find out how much it costs to live in South Carolina. Healthcare, food costs, taxes and of course, housing costs are all things to consider if you’re planning on moving to the Palmetto State.
You can also get ahead by checking South Carolina’s current mortgage rates to get an idea of what mortgage will be right for you.
