Jan 08, 2014
Known as closing costs, these charges can quickly rack up for home buyers.
That’s why today, I’m going to break down exactly what closing costs are and how much they could cost home buyers.
Wake County Real Estate for Sale
Generally speaking, most closing costs are associated with fees that the mortgage lender is charged by a third-party company. These charges are then passed on to the borrower.
These fees must be settled at the time of closing, which is why they’re often called closing costs.
Typically, these fees account for 2 to 5 percent of a home’s sales price, although they can vary from case to case.
Typically, these costs include:
- Getting a credit report
- Processing paperwork for the loan
- Legal fees
- Title insurance
- Title searches
- An escrow deposit
- Home inspections
- Having the transaction recorded in the public record, such as with the county
- Underwriting the mortgage
For the most part, the buyer is responsible for paying most of these closing costs. Although if it has been agreed upon within the contract, the home seller may pay these costs for the buyer.
What’s more, if a home is purchased with a Veterans Affairs loan, then the seller may end up paying some of the closing costs for the buyer.
Beware of the mortgage lender who promises no closing costs because this likely means that the lending institution has built those fees into the structure of the mortgage.
Closing on Your Wake County Home for Sale
Home buyers need not worry about having to wait until closing to find out how much they owe in closing costs.
Lenders must provide a good faith estimate of these costs soon after the borrower has applied for a loan.
And the law also requires that the final closing costs are no more than 105 percent of that estimate.
Still, it helps to work with an experienced Wake Count REALTOR® when you’re navigating the market as a home buyer. After all, they can provide you with valuable expertise and useful resources to make the process feel more seamless.
Until next time,