Closing costs include:
- the costs of borrowing money
 The costs of borrowing money is a one-time charge to adjust the yield on the loan to what market conditions demand, it can be referred to as discout points. Each point equals 1% of the mortgage amount. For example, two and one-half points on a $100,000 mortgage would cost $2,500.
- establishing the loan
The costs of establishing a loan might include the loan origination fee and cost of credit reports. Premiums for hazard and mortgage insurance are usually paid at closing. Also, usually pre-paid interest will be collected for the period between closing and the end of the purchase month.
- purchasing title insurance
- establishing escrow charges
- conducting pest inspections
- preparing the necessary documents to finalize the sale
The costs of document preparation are the title insurance costs for the search of public records to determine if the property you want to purchase is free from any other ownership or liens. Recording and transfer fees cover the legal recording of the deed with the proper governmental agencies as well as the transfer of taxes.
Sometimes the closing costs fees are overlooked or underestimated in the buyers mind. Please consult with your CENTURY 21 agent to establish a good estimate of these costs. |
Buying (loan preapproval, funding, making an offer...) - Realtor.com