Let’s talk about Real Estate closing costs:
Find ALL the fees you’ll pay By James Joseph
F
ees are incurred over and above real estate costs during a real estate transaction. The prices are customarily paid to third-party accounts like mortgage lenders, and the buyer pays expenses associated with new homeowners. Such charges include property taxes, tax service fees, and others. Sellers also pay closing costs such as tax transfer and attorney fees, among others. The expenses vary with the location of the home to be bought and the mortgage lender. Several examples of closing costs by the buyer in detail are such as; HOME INSPECTION FEE Before closing on a new home, it is essential to associate a home inspector who assesses any problems the house might have. If there are any, the buyer can negotiate with the home seller. Such costs range from $280 to $510, depending on the size of the home. The fees are optional, but typically buyers are encouraged not to omit the process. The inspector checks for the home’s condition, and if it is in a bad state, it might lead buyers to withdraw an offer to look for a better home. PROCESSING FEE When an individual applies for a mortgage, there usually are fees charged to the borrower to cater for processing, improving of credit scores, and running credit checks. Processing or application fees also cost around a few hundred dollars and depend on the mortgage lender. ORIGINATION FEE An origination cost is 1% of the total cost and
caters to all mortgage paperwork. Such fees are necessary since they facilitate the buyer to get the loan at the right time. It covers the cost the lender incurs while processing the paper works. PREPAID INTEREST ON A MORTGAGE Buyers usually are encouraged to pay these fees towards the end of the month. Prepaid interests are part of the monthly mortgage interest and cover the duration between the closing date and the first scheduled mortgage payment. APPRAISAL FEE Lenders involve third parties well conversant with home valuation. Valuing is necessary since they prevent one from buying an overcharged home. To the lender, home valuation determines the amount of money a borrower will receive for a given home. They also check whether the home is ready to move in, among other aspects. The appraisal fee is typically between $300 and $600, but in some instances, the price may be higher. ATTORNEY FEES Depending on the state one is, attorney fees are essential. When closing, the attorney prepares and reviews contracts and agreements. The amount paid depends on the buyer and local rates, but real estate attorneys are unimportant in some states. DISCOUNT POINTS Sometimes, the lenders allow one to pay money upfront to reduce mortgage interests. Paying upfront involves buying discount points. A single AUGUST 2022 | 115
