Call (202) 596-8101 | Email us!
facebook linked in twitter youtube
Connect with us

Understanding title & closing costs

Buying a home involves more than looking at houses and choosing a mortgage. Let’s break down the “closing costs” associated with your purchase.

Closing costs usually account for 2 to 5 percent of a home’s sale price, although they may be more or less in some cases. These costs typically cover:

  • Obtaining a credit report
  • Processing paperwork for the loan (loan origination fees)
  • Legal fees
  • Home inspections
  • Appraisals
  • Surveys
  • Title insurance
  • Title searches
  • An escrow deposit
  • Recording the transaction in the city or county’s records
  • Underwriting the mortgage (evaluating the borrower and the property)

In addition to these fees, home buyers may elect to increase their closing costs through discount points, which lower the mortgage’s interest rate and saves the borrower money over the life of the loan.

Who pays closing costs?

In most cases, the buyer pays the bulk of the closing costs. In some cases, however, other parties may absorb a portion or all of these costs. For instance, if a home is purchased using a Veterans Affairs (VA) loan, then the seller will pay some of the closing costs, and the buyer will pay the remaining costs.

Some mortgage lenders advertise mortgages without closing costs. These may or may not be a good choice, depending on the specifics of the mortgage. Home buyers, however, should realize that any bank offering mortgages without closing costs will likely build those fees into the structure of the mortgage. Buyers (or sellers) will probably pay the fees associated with purchasing a house, one way or another.

From the title company to the closing table, the legal issues and costs to understand are simply explained in this VIDEO.

Leave a Reply

Affiliated with RE/MAX Allegiance | (202) 547-5600
 

Copyright © 2017 ADMCRealtyGroup    Log in     Design by Real Estate Tomato     Powered by Tomato Real Estate Blogs