How Much Do I Need to Save for Closing Costs?
If you’re saving up for a home, you’ve likely heard a lot about down payments, but there’s another key homebuying expense you need to plan for: closing costs.
Closing costs are paid when you sign your final mortgage paperwork, and while costs vary depending on the terms of the loan, they typically amount to about 2% to 5%* of the purchase price. Here are costs that might be included:
Appraisal Fee: Paid to the appraiser that estimates the fair market value of your home.
Discount Points: Amount paid to lower your mortgage interest rate.
Origination Fee: Charged by the lender in return for setting up the loan.
Recording Fees: Paid to make your real estate purchase part of the public record.
Title Service Fees: Covers the title search, examination, and insurance.
Transfer Taxes: Cost for transferring the title from the seller to the buyer.
Tip: Can’t afford your closing costs? Talk to your lender about adding the closing costs into your loan.
*Closing cost amounts may differ. All loans are subject to credit and property approval. Certain restrictions may apply.