A GUIDE TO CLOSING COSTS

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BUYER CLOSING COSTS

  • Origination Fee: Payment to lender to evaluate your credit and underwrite and process loan

  • Discount Points: Paid to lender at closing to reduce interest rate over life of mortgage

  • PMI (Private Mortgage Insurance): Required if down payment is less than 20%. This protects the lender if you default

  • Appraisal Fee: Paid to the appraiser to confirm the home’s fair market value.

  • Title Search: Covers cost to confirm seller owns property and that it is free from liens.

  • Title Insurance: Protects lender and (optionally) you if a title claim surfaces later.

  • Termite Inspection: Inspection required to certify the home is free of termite damage.

  • Survey: Charge to verify property boundaries.

  • Flood Certification Fee (if applicable): Covers cost to determine if home is in federally designated flood zone.

  • Prepaid Interest: Covers mortgage interest due between date of closing and first mortgage payment.

  • Prorated Property Tax: Covers property taxes from date of closing to end of tax year.

  • Homeowners Insurance: Typically, you’ll pay full first year cost upfront before or at closing.

  • HOA Transfer fee: Paid on properties governed by associations to transfer ownership documents to you.

  • Initial Escrow: Lender may require first two months of next year’s homeowners insurance, flood insurance and property taxes to build up reserve.

  • Doc Stamps preparation (if applicable)

  • Notary fees

  • Recording fee

  • All new loan charges (except those required by the Lender for Seller to pay)

  • Assumption/Change of Records fees for taking over existing loan)

  • Beneficiary Statement fee for mortgage assumption

  • Home Warranty (sometimes covered by Seller)

  • Closing/Settlement Fee: Paid to title company, attorney or escrow company that conducts closing.

  • Transfer Tax: Paid to state, based on the amount of the mortgage.