Budgeting for buying a home can seem daunting, but one of the best ways to make it easier is to figure out the average closing costs for buyer hopefuls. There are various service charges bundled together to make up closing costs, and some can vary significantly based on location and specific property.
Here are some of the most common closing costs you can prepare for:
Loan origination fee
Mortgage lenders charge an origination fee for creating the loan. This closing cost varies from one mortgage provider to another, but usually ends up being equal to about 1% of the total amount of the loan. While this is considered a closing cost, some lenders require this fee up front for the loan estimate.
Home inspection fee
Home inspection fees typically cost a few hundred dollars. They cover the optional – but important – official property inspection by a licensed professional before closing.
While technically not always required by lenders or buyers, home inspections can help you identify major issues or repair needs before buying a home.
Appraisal fees
Appraisal fees are paid to the professional home appraiser to determine the value of the property. These fees often range from $300 to $400, though the cost can vary depending on location and the size of the home.
Title search
Before a buyer can take over the title for the new home, it has to be examined carefully for any evidence of prior issues. Examples of issues a title search looks for include liens, unpaid property taxes or unfulfilled contingencies. Typically, the fee for a title search will cost around $400 to $500.
These are not all the possible closing costs associated with buying a home. However, they are some of the most common, and the easiest, to budget for. Remember these fees when planning a budget to include average closing costs.
About the Author
Kimberly Hering
Kimberly Hering's devotion to helping people achieve their real estate goals stems from her genuine enjoyment of the process. Whatever the task, Kimberly makes it her mission to get it done, however she can, without compromising her client's needs. Often, that means thinking outside the box. After working with Kimberly, clients describe her as being Trustworthy, Creative, Patient, Highly Skilled, Attentive to the Process and having a lot of Integrity.
After spending more than 15 successful years working on Wall Street, Kimberly transitioned into Real Estate, joining Alain Pinel Realtors, then moving to Zephyr, now Corcoran Global Living, in 2018. During her career on Wall Street, Kimberly was a Vice President working as an Institutional Equity Salesperson for Montgomery Securities for 10 years. She covered the top money managers throughout the US and Canada. She joined Jefferies & Co as a Senior Vice President managing the Western Region Institutional Sales group, while continuing to cover the top money managers.
Kimberly leverages her extensive experience selling equities to top money managers throughout the US and Canada, to successfully negotiating any Real Estate transaction seamlessly for her clients. Kimberly is well versed in Marin's neighborhoods, towns, cities, and education system.
Living in the Bay Area for 35 years, 25 years in Marin and having 2 sons in local Marin schools, Kimberly spends a lot of time volunteering in the community and serving on various local Boards. Kimberly has a collection of resources ranging from the best local breakfast spots to vetted contractors. With her reliable list of valuable resources, Real Estate experience and unsurpassed knowledge of Marin's many communities, Kimberly can guide her clients through every aspect of a Real Estate transaction seamlessly.
Relocating to Marin, downsizing, upsizing, first time home buying, final home purchase or sale, or a lot to build a dream home, no matter the undertaking, Kimberly works seamlessly until the job at hand is completed with 100% satisfaction.