Can You Name a Home-Buyer’s Typical Closing Costs?

Depending on where you live, the price of your home, your lender’s terms, the distribution of fees charged to buyer and/or seller, and other factors, your closing costs on the purchase of a home may range anywhere between 3% and 7% of the home price, sometimes more or less.
Typical buyers’ closing charges include:

  • Loan origination fee, usually 1% of your mortgage amount
  • Discount point (or points), each usually 1% of your mortgage amount
  • Assumption fee (if you assume the seller’s old mortgage)
  • Title search fee
  • Lender’s title insurance fee
  • Owner’s title insurance fee (most often paid for by the Seller)
  • Survey fee (if applicable)
  • Two fees that may have been paid when you applied for your loan:
    • Appraisal fee
    • Credit report fee
  • Lender’s inspection fee
  • Recording fees
  • Prepaid interest on your mortgage, covering the time between settlement and the first regular monthly payment
  • Prepaid mortgage insurance premium
  • Property tax, possible reimbursement to seller and/or payment on future taxes
  • Assessment, possible 1-to-3-month local improvement charge or association fee (especially applicable to condominium buyers)
  • Lawyer’s fees (if applicable)

Your lender must, by law, supply you with a pre-settlement “Good Faith Estimate.” It will not necessarily identify all actual costs. At settlement, however, you receive a “Settlement Statement” that contains all the specific actual charges.
Since occasional unexpected costs may surface at settlement, it is well to be prepared for possible $200 or $300 in extras at your closing. Extra costs usually involve partial payments for items you had not previously considered but, at closing, wish to pay for: fuel oil left in the seller’s tank, firewood, continuation of lawn service, or the purchase of a major appliance.
Since actual costs vary, call or e-mail us for typical figures in your area. Your calls and e-mails are always welcome.

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