Helping make real estate dreams come true
The cost of buying a property goes beyond simply paying the price negotiated between the buyer and seller.
If you pay cash, you will probably pay less and close faster. If you are taking on a mortgage, the closing costs involved to complete the transaction can range from 2% to 7% of the purchase price.
Fees required vary by state. Here are some of the common fees included in a typical settlement, which will comprise your closing costs:
Fees related to a mortgage loan (if you are borrowing to buy):
* Loan origination fee
* Loan discount ("points") - a one-time fee charged by the lender to lower your monthly interest rate
* Appraisal fee* (the lender usually orders an appraisal to determine the value of the property)
* Credit Report fee* (for the lender to research your credit rating)
* Lender's inspection fee* (for walking through the property)
* Mortgage insurance application fee* (for additional insurance to protect the lender if you default)
* Assumption fee* (fee to process new documents if a buyer is taking over a seller's mortgage)
* Underwriting fee (the underwriter or insurer reviews your loan package and gives final approval to close to the lender)
* This fee is usually paid before you meet with the settlement or escrow agent to close the transaction.
Fees a lender requires you to pay in advance:
* Interest on your mortgage loan from the day of closing to the end of the month.
* Hazard insurance premium (protection from such hazards, as fire, wind or vandalism)
Amounts that may be deposited on reserve with the lender:
* Hazard insurance premium for the year (also called "Homeowner's Insurance")
* Mortgage insurance - the number of months varies
* City property taxes - usually two months in advance
* County property taxes - usually two months in advance
* Annual assessments (cover any updated value placed on the property for tax purposes)
Fees related to the property's title:
* Closing fee for the settlement agent or attorney (depending on who handles the closing)
* Document preparation (be sure to ask for details if you are charged for this; also ask about any "courier" fee if imposed)
* Notary fees (for witnessing signatures on legal documents)
* Attorney fees (if a lawyer is involved in the title process)
* Title Insurance - lender's coverage (protects the bank), owner's coverage (guarantees that the buyer has the right to the property)
Transfer and government recording fees:
* Fee to record (place on public file) the deed, mortgage and any releases
* County and possible city transfer taxes due on recording of the deed
Additional Settlement fees
* Pest inspection fee
* Other miscellaneous fees may include home inspections, land surveys, flood certification, earthquake insurance, radon tests, or lead-paint inspections depending on the location and history of the property.
*Broker Administration Fee
*Other Real Estate Agency Fees
Have you received a Notice of Default on your property? What are your plans? Do you plan to walk away or do you want to try a Short Sale which has much less damage to your credit and helps you save face? You need a plan of action and if you want to buy some time, stay in the home until it sells and save up some money - then contact:
Kathleen Lordbock REALTOR/Staging & Short Sale Specialist
Keller Williams Realty Brainerd Lakes
Don't just walk away - there is hope, there is help!
Closing Costs Checklist
The cost of buying a property goes beyond simply paying the price negotiated between the buyer and seller.
If you pay cash, you will probably pay less and close faster. If you are taking on a mortgage, the closing costs involved to complete the transaction can range from 2% to 7% of the purchase price.
Fees required vary by state. Here are some of the common fees included in a typical settlement, which will comprise your closing costs:
Fees related to a mortgage loan (if you are borrowing to buy):
* Loan origination fee
* Loan discount ("points") - a one-time fee charged by the lender to lower your monthly interest rate
* Appraisal fee* (the lender usually orders an appraisal to determine the value of the property)
* Credit Report fee* (for the lender to research your credit rating)
* Lender's inspection fee* (for walking through the property)
* Mortgage insurance application fee* (for additional insurance to protect the lender if you default)
* Assumption fee* (fee to process new documents if a buyer is taking over a seller's mortgage)
* Underwriting fee (the underwriter or insurer reviews your loan package and gives final approval to close to the lender)
* This fee is usually paid before you meet with the settlement or escrow agent to close the transaction.
Fees a lender requires you to pay in advance:
* Interest on your mortgage loan from the day of closing to the end of the month.
* Hazard insurance premium (protection from such hazards, as fire, wind or vandalism)
Amounts that may be deposited on reserve with the lender:
* Hazard insurance premium for the year (also called "Homeowner's Insurance")
* Mortgage insurance - the number of months varies
* City property taxes - usually two months in advance
* County property taxes - usually two months in advance
* Annual assessments (cover any updated value placed on the property for tax purposes)
Fees related to the property's title:
* Closing fee for the settlement agent or attorney (depending on who handles the closing)
* Document preparation (be sure to ask for details if you are charged for this; also ask about any "courier" fee if imposed)
* Notary fees (for witnessing signatures on legal documents)
* Attorney fees (if a lawyer is involved in the title process)
* Title Insurance - lender's coverage (protects the bank), owner's coverage (guarantees that the buyer has the right to the property)
Transfer and government recording fees:
* Fee to record (place on public file) the deed, mortgage and any releases
* County and possible city transfer taxes due on recording of the deed
Additional Settlement fees
* Pest inspection fee
* Other miscellaneous fees may include home inspections, land surveys, flood certification, earthquake insurance, radon tests, or lead-paint inspections depending on the location and history of the property.
*Broker Administration Fee
*Other Real Estate Agency Fees
Have you received a Notice of Default on your property? What are your plans? Do you plan to walk away or do you want to try a Short Sale which has much less damage to your credit and helps you save face? You need a plan of action and if you want to buy some time, stay in the home until it sells and save up some money - then contact:
Kathleen Lordbock REALTOR/Staging & Short Sale Specialist
Keller Williams Realty Brainerd Lakes
Don't just walk away - there is hope, there is help!
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