Buyer's Closing Cost Calculator                                        Seller's Closing Cost Calculator

Buyer's Closing Costs

The total cost of buying a home includes considerably more than just the purchase price alone. The expenses involved in completing the purchase - known as closing costs - represent a substantial additional investment.

Mortgage Application Costs
Most lenders charge a preset fee for submission of a mortgage application. The lender will also require an appraisal of the subject property, which may or may not be included in the application fee. These costs vary from lender to lender, but are generally in a range of $150 to $500.

Inspections
Many lenders require that a home inspection be completed before closing. Even if it is not required, it is well worth doing - you don't want to find a whole series of problems necessitating repairs after you close. In many areas inspections may be required for termites (and other pest infestations) or radon, or both. Inspection costs generally range from $200 to $700.

Title Insurance
The lender will require title insurance to protect against any unforeseen claims against the property. Title insurance can also be purchased to protect the buyer as well. The title company will perform a search to insure that clear title can be passed at the closing and will write the required insurance policy. Costs vary with the amount of coverage, with most homebuyers paying $300 to $1,200.

Mortgage Closing Costs
Most mortgages include 1-3 points, which are due at closing (and are usually deducted from the loan proceeds). Each point is equal to 1% of the loan value. In addition to points, some lenders may charge a processing fee of several hundred dollars. Most lenders also require the prepayment of 1-2 month's mortgage payments (or prorated payments until monthly billing begins) as well as an escrow for property taxes. If private mortgage insurance is required, the first year's premium is also due at the closing.

Homeowner's Insurance
Most lenders require that the first year's homeowner's insurance premium be paid in full before the loan proceeds are released at the closing.

Adjustments with the Seller
The seller is credited for property tax payments that cover the period after the closing. Additionally, the seller receives a credit for any similar items, such as fuel oil remaining in the tank.

Miscellaneous Fees
There are a number of small fees related to the notarization and filing of the deed and the mortgage. These fees vary, but are usually no more than $100. Generally, attorney or escrow company fees are paid at the closing. The survey fee, if not paid previously, is also due at this time.

Loan-Related Closing Costs

Loan Origination Fee
This covers the administrative expenses in setting-up and processing the loan. The loan origination fee may be a percentage of the mortgage amount.

Points (optional)
An option for the home buyer is to pay points to lower the interest rate at which the loan will be repaid. Each point equals 1 percent of the mortgage amount. For example: on a $150,000 loan, 1 point would equal $1,500.

Appraisal Fee
The fee for having the house appraised may be incorporated into the closing costs or payment may be required by the lender at the time the loan application is submitted.

Credit Report
The lender uses a credit report to determine the creditworthiness of the loan applicant. This fee is often paid when the loan application is submitted.

Interest Payment
Typically the buyer is required to pay interest on the mortgage loan to cover the time between the closing date and when the first mortgage payment period begins. For example: If closing is on May 15. Your first monthly payment begins to accrue interest on June 1 with your first mortgage payment due July 1. At closing an interest payment covering the accrual period between May 15 and May 31 may be required.

Escrow Account
At closing a payment may be required to fund the escrow account if the lender is paying home insurance, property taxes and/or other expenses out of the escrow account.

Seller's Closing Costs

The seller is also responsible for certain fees at Closing - some fees may be paid out of closing and these are considered to be paid outside of closing (POC). The following are some of the fees the seller may be asked to pay.

• Survey - depending the area of the country the buyer may be responsible for this fee
• Title insurance
• Recording release charges for the mortgage
• Broker or agents commission - can be 5-7% or the sales price
• State, county and city transfer fees
• Credits to the buyer of unpaid real estate taxes for the prior or current year
• Attorneys fee if any

At closing both the seller and buyer receive a settlement statement commonly known as the HUD-1 statement. The left side shows the amount due from the buyer and the right side adds up what money is due to the seller. The back side of the document details closing costs and who pays what, either the buyer or seller