What You Should Know About Closing Costs
Before you buy a home, it’s important to plan ahead . While most buyers consider how much they need to save for a down payment , many are surprised by the closing costs they have to pay. To ensure you aren’t caught off guard when it’s time to close on your home, you need to understand what closing costs are and how much you should budget for . What Are Closing Costs? People are sometimes surprised by closing costs because they don’t know what they are. According to Bankrate : “Closing costs are the fees and expenses you must pay before becoming the legal owner of a house, condo or townhome . . . Closing costs vary depending on the purchase price of the home and how it’s being financed . . .” In other words, your closing costs are a collection of fees and payments involved with your transaction. According to Freddie Mac , while they can vary by location and situation, closing costs typically include: Government recording costs Appraisal fees Credit report fees Lender origination