Buying a Home? Know Your Closing Costs

Buying a home is about more than just the purchase price. There are additional costs you’ll incur when you buy a home, most of which are due at closing. It’s important to be prepared (and to budget) for those costs. So if you are buying a home, know your closing costs.

So, as a buyer, what closing costs can you expect to pay when you buy a home?  There is not any specific amount as each lender is different. But the lender you use will advise you you talk to them. You loan officer should disclose this information to you when you get apply for pre-qualification or pre-approval of your loan.  Knowing the amount of funds you will need to close, will help you be prepared.

A recent video from realtor.com outlined fees buyers should be prepared to pay at closing, including:

• Lender fees. Your bank or mortgage broker will charge you a loan origination fee that you’ll have to pay at closing. If you purchase points to “buy down” your mortgage, you’ll also have to cover those costs. You may also have to pay an application fee or a filing fee.
• Escrow fees. Escrows are independent companies that complete the closing transaction. Not only are they responsible for ensuring the transaction is legally binding, but they also collect and distribute money from all parties involved (including the lender)—and charge fees for their services. In our area, this fee is charged by the title company, closing agent, or real estate attorney that is handling the closing for the buyer & seller.
• Appraisal fees. Lenders need an appraisal to make sure the house is worth what the buyer has agreed to pay for it—and as the buyer, you’ll need to cover the fee for the appraisal.
• Survey fee.  You may be required to obtain a valid boundary survey.  The seller may have a valid boundary survey, but you must check to make sure if you need to get a new one. Ask the lender about this. They can estimate the fee.  But you or your Realtor will have to get this ordered.
• HOA Fees. If you buy a home in a neighborhood with a mandatory homeowners association, you will have a one-time transfer fee charged by the HOA and the monthly fee amount will be pro-rated to the date of the closing.

We want to be YOUR Realtor!  If you are planning to buy a home, you need to know the amount of your closing costs. We are here to help you every step of the way.  Let’s get you pre-qualified and make sure you know your closing costs.  This will help you plan for 2023!