Understanding Closing Costs

Beyond the purchase price, buyers and sellers each pay certain costs at closing. This post is general information. Your lender and escrow officer can give you exact figures.

Common costs buyers see

  • Lender fees and loan-related charges
  • Escrow and title fees
  • Appraisal and inspection costs
  • Prepaid items, such as property taxes and insurance

Common costs sellers see

  • Agent compensation, as agreed in the listing contract
  • Escrow and title fees, depending on local custom and the contract
  • Transfer taxes, where they apply
  • Payoff of any existing loans

Who pays what can be negotiated, so ask for an estimate early. Tax questions about a sale are best answered by a CPA.

Planning a purchase or sale? Let’s talk through the numbers.

Response

  1. […] come out of that number before it reaches you. I wrote about where those costs typically show up in Understanding Closing Costs if you want the fuller breakdown. Build in a cushion rather than planning around the top-line […]

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