Your Guide to Closing Costs

On top of your deposit, you’ll be responsible for closing costs (unless you and the seller negotiated an alternative). Your closing costs cover all the incidentals that go into carrying out this transaction. This includes appraisals, points (if you choose to buy points), title insurance, and underwriting.

What makes up closing costs?

• Credit report fee – fee for running a credit report
• Loan origination fee – fee for processing a new loan application
• Attorney fees – fee for the lender’s lawyer
• Charges for any inspection – inspector’s fees
• Discount points – if you purchased discount points on your loan
• Appraisal fee – for the bank’s appraiser
• Survey fee – for the surveyor who assesses the property lines
• Title insurance – protects you and the lender from property loss due to liens or title defects
• Title search fees – fee to the title company for researching the property’s records and ensuring there aren’t other claims on the property
• Escrow deposit – first deposit into your escrow account
• Pest inspection fee – for inspecting the property for fests and vermin
• Recording fee – a fee the government charges for creating a record of your purchase for the public record
• Underwriting fee – fee the underwriter charges for assessing and processing your loan

Money to Bring to Your Closing

Your agent will give you a complete breakdown of exactly how much you need to bring to your closing. Remember to bring your checkbook in case there are last-minute adjustments. Also remember never to send any money before verifying it with your agent.

• Balance of purchase price – Balance of your down payment after your earnest money deposit. Must be a certified check or wire transfer.
• Title insurance – Insurance bill to the title company. Must be a certified check.
• Lawyer fees – Money for your real estate lawyer (if you hired one). Can be a personal check (if your lawyer accepts it).
• First year insurance – Insurance bill for the first year to your homeowners insurance company. Can be a personal check.
• First month HOA fee – Your first HOA payment (if applicable). Can be a personal check.