What are closing costs?

Question

I know some may think that is a dumb question, but I am young and getting ready to purchase a house and have been shopping banks. They keep on mentioning closing costs and I feel like a moron for having to ask

Answer 1

Don't feel stupid. Noone usually knows the answer to this question until they've bought a house. Closing costs are all the things that have to be paid for in cash at the closing of your loan when you but the house. These include:

Your down payment
Attorney's fees
Survey fees
Transfer taxes (as applicable where you live)
Any discount points (That is money you can pay upfront to get a lower interest rate)
...and a variety of other b.s. charges, most of which are unavoidable

You can ask the seller to pay soem or all of your closing costs, but that has to be a part of your offer to buy the house. When you have a property picked out (and therefore a purchase price) you can ask for a good faith estimate from your mortgage guy - they are required to give you one anyway when you commit to the loan, but you can ask for one in advance. A list of all closing costs should be on it, and also which ones are normally paid by the seller and which by the buyer. It won't be 100% accurate, but it will give you a pretty good idea.

Answer 2

Typically you can figure 3% of your purchase price is going to go toward closing costs, this can include loan origination, appraisal Fee's credit reports lenders inspection fees, mortgage insurance hazard insurance settlement charges taxes transfer fees- this will all be calculated into the back end of the loan and buyer is responsible to pay this. Also, you can while in the negotiation stage tell your agent to ask for part or all of the closing costs so the seller will help you, into days market its not uncommon and considering your a first time buyer your agent should negotiate in your best interest. Oh, by the way soapscm has no idea what he is talking about.

Answer 3

Mortgage Closing Costs — Lender Fees
After the third–party and state/local government fees have been covered, the remaining portion of closing costs goes to the lender.

Processing Fee ($575 – $1000)
This fee covers the lender's cost to process the information on your loan application.

Underwriting Fee ($195 – $795)
This fee is charged to cover the cost of processing and evaluating your loan application, and for researching whether or not to approve you for the loan.

Loan Discount Points (Generally zero to two percent of loan amount

Answer 4

1- application fee ( 50-100)aprox
2. appraisal fee (200-300) aprox
3. underwriting fee 100-200
4. credit check -15
5. loan origination ( sometimes they dont charge)
5. Lawyers fee 600-1200
6. title insurance 800-1200
7. Pre-paid mortage interest ( this will depend on when you close) If you close on the last day of the month you only pay 1 day interest.

8. possible Escrow taxes and possible escrow insurance of up to 1 year.

Answer 5

Let's see...there's title fees, recording fees, tax service fees, origination fees, underwriting fees, basically any time anyone does work on this transaction, they charge a fee. Be it on the mortgage end, or on the actual real estate end. You're right to be concerned about it, though. Closing costs can be thousands of dollars. Try to work it into your purchase agreement for the seller to pay them, or at least a portion.

Answer 6

the amount of money that you have to pay out of your pocket to actually seal the deal and buy the house it covers lawyer fees and things like that..it can be pretty pricy..I bought a house off of my dad for $14,000 and my closing cost was about $1,500...so make sure you have the money saved..

Answer 7

"on the time i offered my homestead,I owned one greater homestead in Ca" What got here approximately with homestead in Ca? Did You sell it? if so why did no longer you place the proceeeds by contrast debt? in case you probably did no longer sell it, why do you shop it? If the fee is fixed for an entire 30 years, with out hazard of going up, i think of you would be happy interior the destiny while inflation kicks in. no count if it is not fixed, you have too lots debt to fairness in my estimation.

Answer 8

anything having to do with the sale of the house...lawyer fees, title insurance, tax stamps, points if there are any, bank fees, etc.

Answer 9

They are fees that the lender recoups for their efforts and services.

Answer 10

closing costs are a way for someone else to get more of your money.