Understanding and budgeting them will smooth out the final stretch of your home-buying process.
Purchasing a home is a lot of work, but sometimes, doing a little bit extra can save you money! While some closing costs are fixed, some of them you can shop for. Closing costs are the collection of fees, expenses, and charges associated with finalizing your mortgage. After saving for a down payment, house hunting, and applying for a mortgage, closing costs can come as an unpleasant surprise. You’ll have to pay closing costs whether you buy a home or refinance.
Understanding what closing costs cover and budgeting for them will smooth out the final stretch of your home-buying process. Mortgage closing costs are typically around 2-5% of the loan cost, including property taxes, mortgage insurance, and more.
The Fixed Costs Associated With Closings Are:
Property transfer tax
Recording cost with the Registry of Deeds
Declaration of homestead fee
The Things You Can Shop for:
Owner’s Title Insurance
Credit report cost
Settlement agent fee
It is always a good idea to compare offers from lenders, typically we suggest speaking with at least three lenders to compare the loan options and lender fees. If you can get an estimate before you submit your application, try to get different loan estimate forms from different lenders to compare. You might not be able to get out of them, but you can try to get your lender to knock them down. There’s no harm in asking. It’s better to ask for a discount and get denied than to not ask at all.
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