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Closing costs are part of the upfront cash you will need when you purchase your new home. These costs are for the mortgage lender and title company for the services related to your loan. Your closing costs will be greatly reduced if you are paying cash since there is no mortgage lender services to pay.
How Much Do I Have To Pay and Why?
Many buyers are not aware of the additional cost of closing or have an idea how much it is. (Another reason to use a good REALTOR®️). These costs cover, among other things, appraisal, title search, loan servicing fees, title searches and escrow for property taxes. These costs are only paid at closing so if the home purchase does not close, you are not responsible for the work already put in by the title company and the lender.
Closing costs can range from 3% to 6% depending on the lender, title company, type of loan and location of home. This means on a $200,000 mortgage, you should expect to pay around $6,000 to $12,000 in closing costs. The seller DOES have closing costs as well. Since there is no lender on their side, the seller closing costs are usually around 1%-2%.
There are some ways to get assistance with closing costs. There are some programs that assist, for example the Florida Hometown Heros Housing Program is allowing qualified home purchasers to receive up to 5% for their closing costs. Click here to see if you qualify. Hometown Hero Qualification. Also, the buyer can ask the seller to contribute to their closing costs. There are, however, limits based on the type of loan and other factors.
According to Realty Times:
“In 2019, the average paid for closing costs in the U.S. was $5,749, including taxes.
The highest closing costs on average are in parts of the Northeast, including Washington D.C., Delaware, New York, Maryland, and Pennsylvania.
Washington State also has some of the highest closing costs in the nation.
States with the lowest average closing costs include Indiana, Montana, South Dakota, Iowa, and Kentucky.”
What Are The Fees
On your itemized breakdown you will get from your lender and title company, you may see some of these fees:
- Loan Application Fee
- Attorney Fee
- Escrow for property insurance and/or Home Owners Insurance
- Mortgage Insurance
- HOA transfer and escrow fees
- Title Insurance
- Administration fees
It is important to remember you can shop around for your lender. The closing fees vary from lender to lender so make sure you are asking the right questions. In Florida, the seller typically chooses the closing title company so you may not have nay influence over that. However, by the seller choosing the title company, they will pay a bigger cost on title insurance. Not all sellers are willing to provide concessions, but if it can get negotiated at the time of contract it could save you thousands! 💰💰💰
Lastly, and I think most importantly, find a good REALTOR®️ that is knowledgeable about all aspects of the transaction and is trustworthy to help you save as much money as possible when you find your dream home🏡
| Contact me with any questions: | |||||
| Robert Sullivan | SL3413781 FL | |||||
| robert.sullivan@floridamoves.com | |||||
| http://www.robertsullivanrealestate.com | |||||
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| Orlando North/Heathrow | |||||
| 1120 Townpark Ave Ste 1042 Lake Mary, FL 32746 | |||||
| Coldwell Banker Real Estate LLC | |||||
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