Closing Costs

An example of what Closing Costs might look like for a $200,000, owner-occupied loan.

First we'll assume a 5 percent down loan, although there are other options including no down payment loans.

Down Payment: 5 percent $10,000

One year's taxes with a homestead exemption: $3,300 (Your taxes here may be less or they may be more if you don't have an exemption. Without a homestead exemption, taxes are roughly $1900 per $100,000 of the sale price.)

Additional escrows, (Your bank may require pre-paid interest.): $200

Hazard Insurance (1 years premium, pre-paid): $5,000 (Will my hazard insurance be this high? Click here for an explanation.)

Flood Insurance (1 year, pre-paid, depends on elevation and flood zone): $600

Additional escrows for insurance: $1,400 (Your bank may require 3 months pre-paid hazard and flood.)

Additional pre-paid interest: $250

Title Fees (including title insurance, recording and closing fees): $1,500 Lender fees (typically 1% for origination fees and/or other "junk fees")$2,000

Appraisal: $400

Total Closing Costs for this example: $24,650 …………………………………………………………………………………………. Total due at Act of Sale for 3% down: $20,650

Total due at Act of Sale for no money down loan: $14,650

There may be other fees assessed depending on your loan, such as pre-paid mortgage insurance. Remember, many of these numbers can change depending on what rates you find for insurance, title company rates, and lender rates.

Also, whatever earnest money deposit you made when you put the home under contract will be deducted from your closing costs. So if you made a $5,000 earnest money deposit, you would owe $5,000 less on all of the above three scenarios.

This information is not intended to take the place of your HUD-1 statement or an assessment of fees for your particular situation by your lending company and title company. This is only one example of a hypothetical sale. Terms and conditions for every loan are different and could change depending on your type of loan, type of property, lender, title company, terms, etc. . . The author takes no responsibility for the accuracy of these numbers. Rates and terms may change without notice.