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What Are Closing Costs?

May 12, 2014

mortgage-house

If you aren’t paying cash for your home, you need to be prepared to pay closing costs at settlement. Closing costs include all the fees for your lender (like the cost of pulling your credit report, a loan origination fee, and application fees) and other costs, such as home insurance and property taxes. Your lender is required to give you a good faith estimate of your costs, but it’s likely you won’t know the exact amount until the week of closing, when your lender can put together a HUD-1 Settlement Statement.

Sometimes, realtors can negotiate an offer in which the seller pays all or part of the closing costs. If you’re short on cash, this might be an option for you. Make sure that before you make an offer on a home, you contact your lender to get a rough estimate of your closing costs, just to be sure you’ll be able to cover them.

Happy house hunting!

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