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CostHelper > Personal Finance  > Real Estate > Closing a Home

Closing a Home Cost


How Much Does Closing a Home Cost?

 
low costLow: $2,700+average costAverage: $3,024high costHigh: $3,900+
Typical costs:
  • Also known as settlement fees, buyers' average home closing costs range from $2,713 in Missouri to $3,887 in New York state, for a $3,024 national average, according to an annual survey by Bankrate.com. The highest closing costs reported were $11,395 for all fees; the lowest was $1,020. The site lists of average costs by state.
  • Exact closing costs depend entirely on geographical location. What is paid by the buyer or seller even varies between counties in the same state. For example, in certain areas buyers pay for title search and insurance, in other places it's paid by the sellers and in some regions the cost is split between the two. (Title search and insurance runs about $450-$600 but can be as low as $100 in one state and $900 in another.)
Related articles: Refinancing a Mortgage, Homeowner's Insurance, Flood Insurance

What should be included:
  • There are four types of closing or settlement costs: 1) lender fees related to the mortgage loan; 2) third-party fees such as inspections, flood certification or title search and insurance; 3) government fees such as recording the deed and mortgage taxes; and 4) any escrow and interest accounts set up to cover homeowners insurance, property or real estate taxes, loan interest and private mortgage insurance; Bankrate.com[1] gives a quick overview.
  • For a more detailed approach, the US Federal Reserve Board provides a comprehensive Consumer's Guide to Mortgage Settlement Costs[2] with descriptions and cost estimates as well as worksheets[3] to compare these items for two loan offers.
Shopping for closing a home:
  • Depending on the economic market and geographical area, a buyer can ask the seller to pay some or all of the closing costs. FHA and VA loans limit the closing costs paid by the buyer, according to RealEstateABC.com[4] .
  • A lender must give a buyer/borrower a good faith estimate listing itemized closing costs for everything within three days of accepting the loan application. BankRate.com[5] lists tips to lower your lending-related closing costs.
  • A new type of mortgage broker lists all fees, in writing, in advance; get referrals from the Upfront Mortgage Brokers Association[6] .
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What People Are Paying - Recent Comments
Closing costs
Amount: $12,586.96
Posted by: a user in Las Vegas, NV.Posted: April 12th, 2012 01:04PM
We purchased a 295,000 home in '05. After the ordeal we went through, and what we learned from that situation. Closing costs, I now know, should never be that high (we went through a broker, never again!). When you get a mortgage with a bank, the average is between 2500 - 3000 (in very rare cases does it go up to 5000.00).
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Seller's closing cost
Amount: $5,780.00
Posted by: Sivvy in Kershaw, SC.Posted: March 9th, 2011 07:03AM
Recently sold a home. Who/what determines seller/buyer responsibility related to closing cost.
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Closing Cost
Amount: $7,500.00
Posted by: BT in Atlanta, GA.Posted: August 12th, 2010 06:08PM
Seems high compared to others. I purchased half a point on a 390,000 house purchase to make my 30 year mortgage 4%.
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closing costs too high
Amount: $4,500.00
Posted by: DMT in Adams, MA.Posted: April 24th, 2010 03:04AM
I'm in the process of buying a $90,000 house in Mass. I was eligible for a 5.5% 30 yr fixed mortgage thru MassHousing which I thought would save me money--Why am I being charged over $4,000 for closing costs??!! I'm investigating this...
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Closing costs
Amount: $1,026.00
Posted by: Frank in union city, CA.Posted: June 27th, 2009 11:06PM
I just closed my new home(purchased at $399,000) with $1026. My agent told me that I get a pretty good deal, and I guess the seller paid rest of them.
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Closing Costs
Amount: $2,967.00
Posted by: Lil Toad in Hamilton, MO.Posted: October 29th, 2007 01:10PM
We closed on a home in 2003, I know there was questions regarding the charges on closing costs with some companies, charging illegal amounts. The above is what we paid in closing. Can we find out if we got ripped off or not?
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External Resources:
  1.  www.bankrate.com/brm/news/real-estate/BuyerGuide2004/closing-costs.asp
  2.  www.federalreserve.gov/pubs/settlement/default.htm
  3.  www.federalreserve.gov/pubs/settlement/worksheet.htm
  4.  www.realestateabc.com/homebuying/FHAVA.htm#Non-Allowable%20Fees
  5.  www.bankrate.com/finance/exclusives/how-to-negotiate-your-closing-costs-1.aspx
  6.  www.upfrontmortgagebrokers.org/about-us/
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