Guide to Closing Costs

Buyer’s Guide To Closing Costs and Who Pays What

Although most costs involved in a real estate transaction can be negotiated between buyer and seller, there are a lot of costs that are traditionally paid by one party or another. We have set forth below a list of these charges:

The BUYER can generally be expected to pay:

  • lenders policy of title insurance
  • endorsement fees for title insurance
  • escrow fees (50%)
  • impounds and interest on new loan
  • all new loan charges {including appraisal, origination and discount fees, document preparation, etc. (except those required by the lender for the seller to pay)}
  • fire insurance premium for first year
  • courier fees
  • homeowners association dues required by the association for future months

The SELLER can generally be expected to pay:

  • owner’s policy of title insurance
  • homeowners association inspection fee
  • real estate commissions
  • escrow fee (50%)
  • payoff of all existing loans, liens and encumbrances, including all costs and fees incurred by reason of a payoff of existing loan or lien
  • termite work
  • taxes due and payable or back taxes
  • recording charges (50%)
  • overnight delivery fees

Mandatory Costs

FHA AND VA regulations require the seller to pay the following fees in an FHA or VA transaction, if applicable: assignment fee, flood certification fee, bringdown endorsements, document preparation fees, photo/inspection fees, tax service contract, warehousing fees, or any other loan cost or charge except the following: prepaid interest, impounds on new loan, loan origination, loan discount fees or appraisal. In addition, on a VA transaction the seller is required to pay the entire escrow fee.

Below is a list of costs involved in a transaction that are negotiable and there is no general tradition as to which party pays them:

  • Termite inspection fee
  • Home warranty
  • Homeowners Association transfer fees

The above information was provided all or in part courtesy of Capital Title Agency.


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