November 14th, 2007 9:24 PM by Mary Schwarz
Almost 100% of my buyers ask me, "How much are my closing costs?" Understandable so, this is often a very confusing topic. As a real estate agent, my response is always to check with your lender. Lenders are legally required to provide a buyer with a Good Faith Estimate. This is an estimate of the total costs required to obtain a loan. These are the fees for services provided through the closing period - this is how everyone involved in processing your real estate transaction is paid. Closing costs may be a survey, appraisal, underwriting fee, broker closing fee, real estate commission, title insurance, etc. Along with fees, there are prorated items such as taxes and association dues and escrows such as taxes and insurance. Don't forget about inspections and insurance premiums which may be paid in advance or at the time of closing.
Closing costs are paid outside of the loan. This means cash is brought to the closing table. So when you are considering purchasing a home, check with a lender FIRST to make sure there are no surprises on closing day. And remember, buyers can always ask the seller to pay all or a portion of the closing costs. Usually if a buyer makes a fair offer, the seller is willing to provide a closing cost credit.