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What
can I expect to pay for closing costs ?
Nationwide buyers can expect
to pay anywhere from 1 to 5 percent of the loan
on closing costs. In other words, $1,000 to $5,000
in closing costs on a home $100,000 home and include
mortgage fees and other expenses. Because costs
may vary area to area and from lender to lender,
it Ěs important to pay attention to details of
the process.
Here
is a list of standard closing documents you can
expect at closing:
Appraisal
fees This fee is charged relative to
the purchase price or size of the home. For a $100,000
home, $275 is about the minimum charged
Loan
application fees and credit report.
Consumers typically pay $75 to $150 for this report
although there heave been reports of credit fees as
high as $350. ( If your are self employed, you will
need a second business report that costs between $55
and $100.)
Documentation preparations. Some lenders
could charge a variation of prices for this, some
charge underwriting fees, processing fees and documentation
preparation fees, which regularly work out to be less
than 1% of the loan amount.
Title
insurance fee. A mortgage policy, purchased
by the buyer is required. Settlement or closing fees,
title examination fee, endorsements and the actual
mortgage policy fee are included in the title insurance
fee.
Recording the mortgage. This varies
from state to state and county to county, but there
is a fixed cost per page usually about $50
Documentary
stamp tax on the mortgage. This varies
from state to state also, and totals about 35 cents
per $100 borrowed
Survey
fee. Depending on the size of the property
and what state you live in, this cost ranges from
$225 to $400.
Pest
inspection. A good idea, which cost
$75 on average and should be part of an overall inspection
Homeowner's
insurance. Most states collect 14 months
in advance.
Mortgage
insurance.
Otherwise known as PMI, how much you put
down determines this amount. Twenty percent down eliminates
mortgage insurance. The standard is that three months
of this is collected.
Taxes.
Most require four months collected in escrow.
Interim
interest or daily rate of interest .
You pay this through the day of closing through the
end of the month.
Points.
Charges levied by the mortgage lender and usually
payable at closing represent s 1% of the face value
of the mortgage.
Note:
Real estate closing practices vary widely from state
to state and county to county. Where you
live will determine exactly what you pay.
Note
: If you work with more than one broker, you could
incur additional cost as well. Who wants to be
charged twice for report fees, pest inspection fees,
appraisals and other costs associated with applying
for a loan?
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