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Davie Home Finance, 115 Donna Rd NE, Palm Bay, FL 32907
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Closing Costs
Closing costs - Customary costs above and beyond the sale
price of the property that must be paid to cover the transfer of
ownership at closing; these costs generally vary by
geographic location and are typically detailed to the borrower
after submission of a loan application.
Even though the term "closing costs" are used loosely in the
mortgage industry, closing costs should not be confused with
"settlement costs." Settlement costs sum up all costs of the
loan including prepaid items, interest, taxes, and insurance.
When doing a refinance money in escrow with the current
lender is refunded by check sent through the mail to your
residence. Therefore if an escrow account is being set up
again, all monies will have to be essentially re-collected since
the two lenders do not transfer money from one escrow
account to another, nor do they use the same one.
In a refinance transaction, the closing costs are typically
included in the new loan, resulting in minimal "out of pocket"
expenses for the borrower.
The closing costs usually range between 2 percent to 6
percent of the loan amount. Expect to pay for such things as a
loan origination fee, points, appraisal fee, title search and
insurance, survey, taxes, deed recording fee, credit report
charge and other costs assessed at settlement.
You can determine the breakdown of all the closing cost by
reviewing your Good Faith Estimate that is provided by your
loan officer. It is important to note that the Good Faith
Estimate is only an ESTIMATE. Seldom does the GFE
exactly represent the closing costs for a loan with a specific
lender. For this reason, you should never do business with
somebody based solely on the Good Faith Estimate. Many
good brokers will overstate the amount of your closing costs,
so you aren't surprised by an increase in costs when it comes
time to close the loan. Conversely, many bad brokers will
understate the amount of closing costs in order to lure you into
doing business with them.
The Closing Costs for your transaction will be itemized on the
HUD-1 form at closing. This form lists all the details of the
purchase or refinance, the money going into and out of the
transaction. This form is generally finalized and available to
the borrower, seller, Real Estate Agents and Brokers 24-48
hours before closing. All parties involved should review the
HUD-1 at this time to identify any discrepancies. Depending
on your situation and the timing of your closing this form may
not be available until the day of closing.
As a buyer in the transaction you may ask the seller to
contribute to your closing costs. In most cases the typical
amount is 3% but this is not set in stone. It can be as high as
6% depending on what your lender will allow with the program
you are using. This is a negotiable amount and not all sellers
are willing to contribute. In areas of the country where the real
estate market is really hot and you have buyers fighting for
properties it can be more difficult to accomplish this. Always
ask if the seller is willing to contribute to closing costs
because you just might be surprised.
Closing costs - Customary costs above and beyond the sale
price of the property that must be paid to cover the transfer of
ownership at closing; these costs generally vary by
geographic location and are typically detailed to the borrower
after submission of a loan application.
Even though the term "closing costs" are used loosely in the
mortgage industry, closing costs should not be confused with
"settlement costs." Settlement costs sum up all costs of the
loan including prepaid items, interest, taxes, and insurance.
When doing a refinance money in escrow with the current
lender is refunded by check sent through the mail to your
residence. Therefore if an escrow account is being set up
again, all monies will have to be essentially re-collected since
the two lenders do not transfer money from one escrow
account to another, nor do they use the same one.
In a refinance transaction, the closing costs are typically
included in the new loan, resulting in minimal "out of pocket"
expenses for the borrower.
The closing costs usually range between 2 percent to 6
percent of the loan amount. Expect to pay for such things as a
loan origination fee, points, appraisal fee, title search and
insurance, survey, taxes, deed recording fee, credit report
charge and other costs assessed at settlement.
You can determine the breakdown of all the closing cost by
reviewing your Good Faith Estimate that is provided by your
loan officer. It is important to note that the Good Faith
Estimate is only an ESTIMATE. Seldom does the GFE
exactly represent the closing costs for a loan with a specific
lender. For this reason, you should never do business with
somebody based solely on the Good Faith Estimate. Many
good brokers will overstate the amount of your closing costs,
so you aren't surprised by an increase in costs when it comes
time to close the loan. Conversely, many bad brokers will
understate the amount of closing costs in order to lure you into
doing business with them.
The Closing Costs for your transaction will be itemized on the
HUD-1 form at closing. This form lists all the details of the
purchase or refinance, the money going into and out of the
transaction. This form is generally finalized and available to
the borrower, seller, Real Estate Agents and Brokers 24-48
hours before closing. All parties involved should review the
HUD-1 at this time to identify any discrepancies. Depending
on your situation and the timing of your closing this form may
not be available until the day of closing.
As a buyer in the transaction you may ask the seller to
contribute to your closing costs. In most cases the typical
amount is 3% but this is not set in stone. It can be as high as
6% depending on what your lender will allow with the program
you are using. This is a negotiable amount and not all sellers
are willing to contribute. In areas of the country where the real
estate market is really hot and you have buyers fighting for
properties it can be more difficult to accomplish this. Always
ask if the seller is willing to contribute to closing costs
because you just might be surprised.
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