Closing costs 101

Home buyers!  You’ve budgeted, reviewed home values and saved for a down payment, but have you thought about the added expense of closing costs?  Closing costs are standard real estate fees levied by lenders and third parties; BUT they can be financed as part of the deal or paid upfront.  How much ARE closing costs?  Well, they are typically 2% to 5% of a home’s purchase price.  For example, closing costs on a $150,000 home would be between $3,000 and $7,500. 

I highly recommend that you speak with your lender and Real Estate agent EARLY in the process so that you’ll know how much you will be responsible for on closing day.  This will avoid a lot of headaches on closing day about unexpected fees. 

By law, a homebuyer will receive a loan estimate from their lender 3 days after submitting their loan application and they should receive a closing disclosure 3 days before the scheduled closing on their home. The closing disclosure includes final details about the loan and the closing costs.

If you’re in doubt, ask your Agent!  I like to educate my buyers about closing costs up front so there are no unexpected surprises on closing day.