Budgeting for buying a home can seem daunting, but one of the best ways to make it easier is to figure out the average closing costs for buyer hopefuls. There are various service charges bundled together to make up closing costs, and some can vary significantly based on location and specific property.
Here are some of the most common closing costs you can prepare for:
Mortgage lenders charge an origination fee for creating the loan. This closing cost varies from one mortgage provider to another, but usually ends up being equal to about 1% of the total amount of the loan. While this is considered a closing cost, some lenders require this fee up front for the loan estimate.
Home inspection fees typically cost a few hundred dollars. They cover the optional – but important – official property inspection by a licensed professional before closing.
While technically not always required by lenders or buyers, home inspections can help you identify major issues or repair needs before buying a home.
Appraisal fees are paid to the professional home appraiser to determine the value of the property. These fees often range from $300 to $400, though the cost can vary depending on location and the size of the home.
Before a buyer can take over the title for the new home, it has to be examined carefully for any evidence of prior issues. Examples of issues a title search looks for include liens, unpaid property taxes or unfulfilled contingencies. Typically, the fee for a title search will cost around $400 to $500.
These are not all the possible closing costs associated with buying a home. However, they are some of the most common, and the easiest, to budget for. Remember these fees when planning a budget to include average closing costs.
My name is Lauren and I am passionate about matching people with their perfect home. Even with price constraints, location needs, and other factors that people think limit them, I believe with all my heart that everyone can still have the perfect home for them!
As a happy member of the Hillman Homes team, I can tell you that our boutique office offers you a friendly and customized approach. There are no shortcuts and no one-size-fits-all approach to home buying at Hillman. We work with you the way that is best for you.