Closing costs are a vital part of a home sale transaction. So what exactly are they, and what do they include?
If you’re a first-time homebuyer, you may not have heard the term “closing costs.” However, it is imperative that you know what these are, what they include, and how much they are likely to be.
In short, closing costs are the fees and expenses you must pay before becoming the legal owner of a property. These costs vary depending on the purchase price of the home and how it’s being financed. They typically include:
- Government recording costs
- Appraisal fees
- Credit report fees
- Lender origination fees
- Title services
- Tax service fees
- Survey fees
- Attorney fees
- Underwriting fees
All told, how much do these costs typically total? While it’s true that the dollar amount depends on a number of factors, they typically end up being between 2 and 5 percent of a property’s total purchase price. For example, a $363,000 home would probably incur around $7,200 to $18,200 in closing costs.
As you’re preparing to buy a home, you must plan for the fees and payments you’ll be responsible for at close of escrow. Your best bet? Work with an experienced lender throughout the purchase process who can answer all your questions. If you’re ready to explore your lending options, contact Allycyn Bennett of Sandstone Financial at 949.717.7290 today.
