What Are Closing Costs

Closing costs are on both the buying and selling side of a transaction. If you are looking to learn more about what exactly they all entail, please keep reading as Carter goes over some of the most common closing costs that you face as a buyer or seller.

Home Buyer Closing Costs

Buyers face closing costs when they are either purchasing a home for cash or when they finance it through a mortgage lender. The main difference between the two is that the buyer will have significantly higher costs when going through a lender. 

The main reason behind this is because there are more people that need to be paid. Instead of just paying for a title insurance policy, now you will need to pay for lender origination fee, discount points, appraisal fee, recording fee, and several other minimal fees. 

The main cost is the lender fee which depends on if you go through a mortgage broker or normal bank. In my experience, local banks have significantly cheaper closing costs. 

Home Seller Closing Costs

As a home seller, you will also have to pay closing costs. The main and largest expense would be the commission for the Realtors. After that you will have the title company fees, transfer tax, recording fee, special assessment letter, past due utilities, and a few other misc. fees depending on the transaction. 

When everything is added up these fees typically come to 1-2% for the home buyer and 8-9% for the home seller (if a Realtor is involved) 

If you want an easy way to avoid paying all the closing costs on the seller side, please reach out to us today for a cash offer where we pay all closing costs!