The Lowdown on Closing Costs
When you get a mortgage, you will need to pay closing costs, which are fees – charged by lenders and third parties -- related to the purchase of the home. So, in addition to owing the lender the down payment on the home and the principal and interest related to the mortgage, you will also owe the lender and third parties closing costs, which you usually pay at the time that you close on your mortgage. Most of the time, it is the home buyer who pays the closing costs, rather than the seller, though on some loans such as VA loans, the seller pays a portion of these costs.
How much will you pay in closing costs?
Typically, home buyers will pay between about 2 and 5 percent of the purchase price of their home in closing costs. So, if your home cost $150,000, you might pay between $3,000 and $7,500 in closing costs. On average, buyers pay roughly $3,700 in closing costs, according to a recent survey. Lenders are required by law to give you a good faith estimate (GFE) of what the closing costs on your home will be within three days of when you apply for a loan. But these are just an estimate, and many of the fees listed on the GFE can legally change by up to 10 percent, potentially adding thousands of dollars to your final closing cost bill. Within a day of your closing, the lender should give you a HUD-1 settlement statement, which outlines closing costs. Compare this to your GFE and ask the lender to explain what each line item on your closing costs is and why it is needed. Often, many of the fees that make up closing costs are negotiable, and some are completely unnecessary, especially things such as high administrative, mailing or courier costs charged by your lender. If the closing costs come in high, you can walk away from the loan; there are plenty of lenders who might be willing to offer you lower closing costs.
What Are Buyer's Closing Costs and How Much Are They Typically?
Do I Need A Lawyer for Closing?
Unless you have experience in writing and filing a deed, you will need to hire a lawyer for deed preparation and recording. Choosing the right lawyer to assist in closing can significantly reduce potential problems associated with purchasing a home.
The following list of lawyers is made available as a convenience to my clients.
Buck Adams: 910-295-1700; Fax (295-1612)
Craig Phifer: 910-692-5100; Fax (692-2259)
Pendleton Hayes: 910-693-0043; Fax (693-0045)
Robert Friesen: 910-692-4900; Fax (692-4286)
Do I Need a Home Inspection?
Most homebuyers lack the knowledge and skill to properly conduct home inspections. State licensed home Inspectors typically evaluate structural components (floors, walls, roofs, chimneys, foundations, etc.) mechanical systems (plumbing, electrical, heating/air conditioning, installed appliances) and other major components of the property.
All-Pro Inspections: 910-693-0122
Affiliated Inspectors: 910-245-2472
Do I Need a Termite Inspection?
Definitely! Wood destroying insects can cause extensive damage in a short period of time.
For local pest control, call:
Aberdeen Exterminator: 901-944-2474
Do I Need a Home Warranty?
Home warranties provide both buyer and seller protection against unexpected breakdown and repair due to normal wear and tear. The Service Agreement does not cover everything and a buyer/seller should carefully read what protection is offered by the Home Warranty Provider. Sellers sometime offer Home Warranties to provide competitive advantage over homes without a warranty.
What Utilities Will I need to Convert Before Closing?
Progress Energy: 800-452-2777
Southern Pines: 910-692-2206
Whispering Pines: 910-949-2010
Ferrell gas: 910-944-1087
North Carolina Gas: 800-275-6264
Time Warner: 910-692-6684
Direct TV: 800-201-4416
- information from zillow.com
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