Understanding Closing Costs

There are certain standard costs related to closing the sale of a house. These fees are divided between the Buyer and Seller, as written in the contract.

Closing Costs the Buyer May Have:

  • Mortgage Lender fees, which include charges for loan processing, appraisals, underwriting, preparation and establishing an escrow account, etc.
  • Third-party fees such as charges for insurance, title search, closing fees to the Title Company, processing fees to your Real Estate Agent’s Broker, etc.
  • Government fees, which include deed recording and state & local mortgage taxes
  • Escrow and interest fees, which include homeowner’s insurance, loan interest, real estate taxes, and private mortgage insurance (if applicable)

Closing Costs the Seller May Have:

  • Title insurance fees, if applicable
  • Broker’s commission is a fee usually costing between 5% to 7% of the purchase price, split between the Listing and Selling Brokers
  • Third-party fees such as closing fees to the Title Company, processing fees to your Real Estate Agent’s Broker, etc.
  • Local property transfer tax, county transfer tax, state transfer tax, and state capital gains tax
  • Credit to the Buyer of unpaid real estate taxes for the prior or current year
  • Miscellaneous fees and/or credits to the Buyer can occur from correcting problems during the inspection