Closing Costs

Closing costs are the fees and expenses you pay when finalizing a home purchase, separate from the down payment. They typically range from 2-5% of the purchase price.

Common Closing Costs:

Lender Fees:

• Loan origination fee (0.5-1% of loan)
• Application fee
• Credit report fee
• Underwriting fee
• Points (optional, to lower rate)

  Third-Party Fees:

• Appraisal fee ($300-$500)
• Home inspection ($300-$500)
• Title search and insurance
• Attorney fees (in some states)
• Survey fee

  Prepaid Items:

• Property taxes (prorated)
• Homeowner's insurance (first year)
• Prepaid interest
• HOA fees (prorated)

  Government Fees:

• Recording fees
• Transfer taxes (varies by location)

  Who Pays What:

• Buyers typically pay most closing costs
• Sellers may contribute (negotiable)
• Some costs are split

  Reducing Closing Costs:

• Shop for lender fees
• Negotiate seller contributions
• Ask about lender credits
• Compare title company fees

  Loan Estimate:

Lenders must provide a Loan Estimate within 3 days of application, itemizing expected closing costs. Compare these when shopping for mortgages.