Homebuyers should be aware that getting a mortgage encompasses more costs than just the monthly payment.
After you sign the sales contract, a series of tasks occur by various people involved in the home purchasing process.
It is well worth bearing this in mind.
These people are compensated through what is known as closing costs. The fees that make up the closing costs pay each of the resources who complete specific tasks once the loan is closed.
The amount of closing costs you have to pay will depend heavily on the region in which you are purchasing a house. Since different areas of the country tax differently, your closing costs will vary. Another reason that closing costs can vary is the fee scale of realtors, attorneys, and lenders which also vary depending on the region.
You can generally expect to pay closing costs in an amount that is between 3% and 6% of the total amount of the loan. For a $100,000 loan, you could end up paying anywhere from $3,000 to $6,000 or possibly more.
Many of the fees associated with the closing costs can be negotiated. Lenders must provide you with an estimate of the fees you will be required to pay within three days of receipt of your application. Once you receive the list of fees, you can negotiate with the lender to reduce or eliminate some of the fees. Some buyers are also to negotiate to have the seller pay some of the closing costs.
Closing cost fees are associated with three major tasks in the home buying process: the cost of getting the loan, the property's transfer of ownership, and state and local government taxes. Here are some of the costs you can expect to be included in the closing costs:
