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 is 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.
Tittle 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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