Closing Costs

Closing costs typically make up about 2 to 4% of the purchase price of your home. You’ll receive a good faith estimate of these and other mortgage related costs three days after your complete your loan application. This will give you an idea of what to expect to pay at closing.

Your closing costs will show up on the (U.S. Department of Housing and Urban Development) HUD-1 Settlement Form. This document must be completed prior to finalizing the purchase of your home.

Closing Cost Fees and Charges

The HUD-1 Settlement Form will contain the following sections and lists of fees and charges within these sections at closing:

• Commissions- If you worked with a realtor,  their commission will be due at closing.
• Government filing fees
  • Recording  Fee
  • Transaction Fees.
  • Title and Closing Charges
    • Settlement/Closing Fee
    • Title Search Fees
    • Document Preparation
    • Notary Fee
    • Attorney Fees
    • Title Insurance
    • Escrow (if any)
    • Items required by the lender to be paid in advance
      • Interest
      • Mortgage Insurance Premium
      • Hazard Insurance Premium
      • Flood Insurance
      • Direct Loan Costs
        • Loan origination
        • Loan Discount (Points)
        • Appraisal Fees
        • Credit Report Fee
        • Lender Inspection Fees
        • Mortgage Insurance Application fee
        • Assumption Fee
        • Mortgage Broker Fee
        • Yield Spread Premium
        • Other Miscellaneous Charges
          • Survey Fee
          • Inspection Fees

Since these charges can come up to a significant amount, make sure you plan for them at closing.

You can find out more information on closing costs on the HUD website http://www.hud.gov/ .

Steve Wyrostek -HomeLoans.org Expert A 20 year plus veteran of the insurance industry, Steve managed departments in the personal and commercial lines areas of major insurers. He’s familiar with how insurance—ranging from boat to workers compensation—works.