For those of you just becoming acquainted with the home buying process, a common question you may have is what closing costs fall under the responsibility of the buyer?
There are quite a few variables associated with the closing costs in a real estate transaction. One example is that cash deals are much easier to close than ones involving a buyer’s mortgage financing. Refinancing is often treated the same was as a sale of property even though the buyer and seller are one in the same. Many closing costs are similar but yours can only be exactly calculated and determined by a title closing agent.
The four to be usually expected are as follows:
Recording Fees: These fees are exactly what they imply…charges for the recording of documents, doc stamps, and intangible taxes. It’s based on the number of document pages to be recorded or by the sales price. These charges are determined at the time of closing.
Property Taxes: These are usually prorated between the seller and buyer.
Miscellaneous Charges: These charges might include such things as HOA (home owner association) fees, condominium fees, premiums for the homeowner and/ or flood insurance, survey reports, termite inspections and more. They will be charged and show on the settlement statement. These charges vary for everybody and can be determined by your title agent before you close.
Closing Costs: These are the costs incurred by the title agency for its administrative work in preparing as well as closing the transaction. Closing costs are a bundle of overnight charges, file processing, and storage fees. They can vary greatly between title agencies and can depend on the type of transaction. However, most title agencies in the same general location will charge similar rates.
Each transaction is different so you’re likely to have different costs every time you buy or sell. As a general rule of thumb, closing costs are between $2,000 and $10,000. I know, that’s a big difference but it also depends on the price of the property as well. Land and large acreage homes typically have higher closings costs. Some lenders can build this cost into the price of the home, which saves buyers the large headache of coming up with a huge chunk of money.
Give me a call today if you have more questions about closing costs and the details of buying a home.