Listed below are the closing costs that a buyer is likely to encounter when purchasing
a new home. Hover your mouse over each individual item to provide information about
the nature of the service and provide guidelines that can be used to estimate their
It’s important to appreciate that the information offered here is simply a tool
for prospective buyers to get a very preliminary idea of what the closing costs
associated with a purchase might be. When it’s actually time to proceed with the
purchase of a home, their lender will provide a more formal and precise estimate
of the costs involved in the form of a “Good Faith Estimate” (click image at the
right to see a sample).
Mortgage Application Fee:
The fee the lender collects to process the mortgage application. This fee varies
from lender to lender.
This fee is paid to the County Recorder’s Office for the recording of the Deed and
is typically $25.00.
The fee charged by the lender to run the credit report. This fee varies between
$15 and $50.
These fees are collected for the transfer of documents between the title company
and the lender either by courier or electronically and ranges between $50 and $100.
The fee the lender charges for processing the paperwork on a new loan. It can be
as high as 1% of the loan amount and can also be eliminated by paying a slightly
higher interest rate.
Lenders require that a 1 year homeowners insurance policy be placed on the property.
The premium must be paid in advance.
Also known as “Points”, one (1) point equals 1% of the loan amount. The interest
rate on the loan is often quoted with no points. Paying points will buy down the
interest rate. The more points you pay, the lower your interest rate will be and
If the property is located in a flood zone, the lender will require that a 1 year
flood insurance policy be placed on the property. The premium must be paid in advance.
Private Mortgage Insurance may be required if you have a down payment of less than
20% of the price. The first year’s premium is paid in advance at close of escrow.
Association Fee Impounds:
Some Homeowners Associations collect 2 – 3 months of HOA fees which are held in
an escrow account.
$350 to $1,000, depending on the size and price of the home.
Association Transfer Fee:
A one time fee paid to the Homeowner's Association to transfer the account from
the Seller to the Buyer. This fee is negotiable between both parties and can be
anywhere from $100 to a percentage of the sales price.
Some Homeowners Associations may collect an additional one time fee called a Working
Capital Contribution or Capital Improvement Fee. This does not apply to all HOA’s
and again, the fee can vary from specified dollar amount to a percentage of the
Usually not required on homes in our area.
$200 - $500 depending on the size of the home & scope of the inspection (pool, spa,
An account held by the lender to pay future taxes. Typically, three months worth
of property taxes are collected by the lender at the close of escrow.
$40 - $100, depending on the size of the home.
The lender will require prepaid interest from the day of the closing to the first
day of the following month.
$300 - $700 depending on the scope & type of coverage. This fee is negotiable between
the Buyer & the Seller.
A fee charged by the escrow company to handle the paperwork in transferring title,
adjusting taxes, distributing funds, etc. The fee is based on the sales price &
is usually split between the Buyer & Seller.
Lenders Title Policy:
This is an Insurance Policy which protects the lender in the event there is a future
problem with the chain of title. The fee is based on the loan amount.
Clicking on this
will produce a printable worksheet that will be helpful in creating a personalized
estimate of your expenses.
Please note, the Closing Costs sheet above is in Microsoft Excel format. You will
need Microsoft Excel or a similar spreadsheet program to properly view and use the