Closing costs

“Closing costs” are various fees charged by those involved with the transfer of property from the seller to the buyer. Some fees are paid by the seller; some are paid by the buyer. Who pays what is always negotiable.

Closing costs are fees paid to transfer property ownership. These fees are for items such as: title policies, recording fees, inspections, courier charges, any fees that lenders charge. The amount of these fees depend largely upon where you live.

Closing costs can range from one to eight percent of the home’s cost, though they are usually about three to five percent of the total purchase price.

Do not ignore closing costs as part of the cost to buy or sell a home.

What the Seller Typically Pays

Current Foreclosures Could Take 45 Years to Process

Here are some tidbits I learned this week:

“Leads convert 22 times more often when you make contact in 5 minutes” Source: study by Massachusetts Institute of Technology (MIT).

Every 1% decline in homeownership equals 1 million new rental households.

According to Bankrate, nationally, closing costs are up 8.8% over the same time last year. The increase is attributed to all the extra work lenders have to do to approve mortgage applications. The extra work stems from increased scrutiny and more rigid lender regulations since the banking meltdown of recent years.

The most expensive states for closing a real estate transaction are:

New York: $6,183
Texas: $4,944

The least expensive states for closing are:

Arkansas: $3,378
North Carolina: $3,410 (I love this state!)

I recently read that, at the rate banks are processing foreclosures, to foreclose on all the delinquent loans they now hold, would take them 45 years. Are you looking for a quick turn around in the housing market..?

09 / 17 / 2011
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Closing Costs – How Expensive are They?

Calculator

It depends upon where you live, of course.

Bankrate did a survey in 2009 and 2010 of 49 states, 2 areas in California and the District of Columbia.

The 5 most expensive states for closing costs are:

New York – origination fees, title and closing costs = $5623
Texas – origination fees, title and closing costs = $4708
Utah – origination fees, title and closing costs = $4605
California – origination fees, title and closing costs = $4566
Alaska – origination fees, title and closing costs = $4327

North Carolina ranked 51 out of the 52 areas surveyed with total closing costs averaging $3255. Hooray North Carolina! Everyone should live here!

Arkansas was the least expensive coming in number 53 with costs averaging only $3007.

These numbers were based on a $200,000 purchase with 20% down.

For a breakdown of costs in your state, check out Bankrate.com.

Why is it important that you understand your closing costs?

08 / 20 / 2010
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First Time Homebuyer Questions

My son and daughter-in-law are in the process of buying their first home (they want that $8000 tax credit!) and they’re asking some really great first time homebuyer questions. I thought I’d repeat some of our conversation here:

No seller really expects a full price offer, not in this economy anyway. The past national average was that offers came in 3%-5% below asking price. Now experts say the average national discount is about 10%. Sellers are not surprised when you offer less than they’re asking.

6% real estate commission is the norm in most states. If you buy from a for-sale-by-owner, you can use this to reduce your asking price since, if you buy their home, they won’t be paying that commission. The seller knows this will be a cost if they list the property and they expect to pay some commission if a Realtor brings them a buyer.

Closing costs. Both buyers and sellers pay some and can negotiate who pays what. In North Carolina, typically what the buyer pays includes: