What Are Closing Costs?
The house hunting journey can be a very exciting time if you are looking for a home. Going above and beyond your moving costs and the mortgage loan, you might have closing costs to pay. You should factor these in when you're budgeting for your house move as you will want to make sure that you have the finances available.
What are these closing costs? Well, they are the various expenses you will need to cover when finalizing your mortgage. You can find out more about your estimated fees when you speak with us. You can also get an idea of how much you will have to pay when using a closing costs calculator, although state to state does vary and is just a general idea.
These fees typically fall on the buyer but home sellers also have expenses to pay, including the real estate agent's commission.
Getting To Know Your Loan Estimate
The more you know about your loan estimate fees the better, as you will then be able to budget for them. You won't have any surprises to worry about either when finalizing your mortgage. After the mortgage quote, then the pre-approval, if you want to proceed you the next step is to sign an estimate of loan costs. This is called a Loan Estimate, this will provide you with the costs of the loan, however fees may be different at the end of the loan
How much are Closing Costs?
The average charges for the buyer will depend on the loan amount, and the rate that you get, as some you may have to pay a premium for, while at other you might actually get a credit (discount) to accept a higher rate from the lender.
We will put you in touch with the lender that can meet your specific set of circumstances. If you're a first-time buyer, you may be eligible for a loan program or a grant to help you with your expenses, and we will discuss these with you.
After finding out what your estimated closing costs are, you have two choices. You can pay them early as a one-time expense or you can finance them by adding them to your loan. If you do fold them into the loan, your monthly mortgage payments might be higher.
What Types Of Expenses Make Up My Estimated Closing Costs?
There are a number of expenses you will need to cover when finalizing your mortgage. Your estimated fee schedule might include the following.
There are at least three property-related expenses you might have to cover as part of your general cost. However, you might get an appraisal waiver from the lender. The insurance company may or may not require the inspection, as this is up to the insurance company. The title company will generally want a survey unless one was previously done by the owner and is accepted by title. Condos should not require a survey, and most lenders will want an HO6 insurance policy for interior content in Florida, you might need to get the master flood and property policy as well.
The first is the cost of the appraisal. Your lender might require, unless waived, a professional appraiser to estimate the property's market value. This is so they can verify that the amount of loan you are requesting can be justified.
The second fee will be related to a home inspection. This is generally required by the insurance company through which you are trying to purchase homeowners insurance.
The third is the survey, which is generally a requirement of the title company for any new home purchase, with the general exception of condos.
There are several loan-related expenses and fees you will be expected to cover, including but not limited to: loan underwriter, origination, processing, state recording, title insurance, prepaid items and possibly transfer taxes.
Mortgage insurance fees, title fees, credit report fees, insurance costs, and expenses related to your property taxes are just some of the other items you may need to pay. You can find out more about these and others at Nerdwallet or by using the closing cost calculator we linked you to earlier.
Closing Disclosures Costs: Get In Touch To Find Out More
To understand more about getting a mortgage and the closing disclosure, which is generally the final costs of the loan and should provide you with a more accurate cost of the loan, and should not vary that much from the closing date. Please connect with us further to discuss as this topic can get very specific and will be unique to each loan.
As a mortgage broker in Florida, we will try to answer any questions you might have on the subject so we can help you in your quest to purchase a new home.