According to a recent survey conducted by ClosingCorp, over half of all homebuyers are surprised by the closing costs required to obtain their mortgage.
After surveying 1,000 first-time and repeat homebuyers, the results revealed that 17% of homebuyers were surprised that closing costs were required at all, while another 35% were stunned by how much higher the fees were than expected.
“Homebuyers reported being most surprised by mortgage insurance, followed by bank fees and points, taxes, title insurance and appraisal fees.”
Bankrate.com recently gathered closing cost data from lenders in every state and Washington, D.C. to be able to share the average costs in each state. The map below was created using the closing costs on a $200,000 mortgage with a 20% down payment.
Keep in mind that if you are in the market for a home above this price range. your costs could be significantly more. According to Freddie Mac,
“Closing costs are typically between 2 and 5% of your purchase price.”
Speak with your lender and agent early and often to determine how much you’ll be responsible for at closing. I am happy to provide my clients with an estimate of those costs as part of the decision on what offer to make. Finding out that you’ll need to come up with thousands of dollars right before closing is not a surprise anyone ever wants to hear What are some of the typical costs? Here'a a list of some common items.
- TItle Company Fees
- Homeowners TItle Policy
- Lenders Title Policy
- Inspection Fee
- Appraisal fee
- Down payment
- Escrow Funding for Taxes and Insurance
- Document Filing Fees for Deed and Government Recording
- A fee for an attorney to review the transaction for the title company.
Some of these costs can be reduced to the buyer depending on the price of the home and the current market. If you are working with an agent, you have the right to insist on an estimate of closing costs BEFORE you make an offer. Your lender is required to do another as part of the process when you apply for the mortgage.
Have a question about closing costs or fees? Check out the information on this website under the buyer's tab or send me a message. If you have the informtion before you make an offer, your agent can help make sure that you have no unpleasant closing surprises!