Home Courses Livestream On-Demand Resources Hall of Fame Store Training Schedule Guest: Sign In / Register

News Feed

Real Estate Closing Costs Explained

By: Elite Legacy Education, November 3, 2017

According to Realtor.com, “Home buyers pay the majority of closing costs since many of these fees are associated with the mortgage.” Regardless of which side you’re on – either buying or selling – you’ll surely want to know how much closing costs are.

 

What are closing costs?

Closing costs refer to all of the expenses that must be paid by the buyer and seller of a home in order to complete the transaction. These costs typically refer to administrative work required to process the mortgage, as well as commissions for the real estate agents. Don’t be fooled by this oversimplification. As you’ll see next, there are many fees that really start to add up.

 

How much are closing costs for the buyer?

Since various fees can differ from state to state, let’s focus on the different expenses buyers need to cover, rather than a specific dollar amount.

 

  • Loan origination fee – for processing your loan paperwork
  • Credit check fee – for checking your credit history and score
  • Loan underwriter fee – for assessing your credit worthiness
  • Property appraisal fee – to ensure property value matches your desired loan size
  • Home inspection fee – to ensure the property is as listed
  • Title search fee – to ensure no outstanding property liens exist
  • Survey fee – for single-family homes and townhomes only
  • Stamp taxes – on any money borrowed for your loan

 

As you can see there are several sources of additional expenses when it comes to closing a real estate deal – especially for the buyer. All of these added fees are required to ensure that everything is in order with the mortgage, property and the overall deal.

 

How much are closing costs for the seller?

After the extensive list above, it may seem that sellers don’t have to cover as many expenses as buyers:

 

  • Closing fee – to the title company or real estate attorney
  • Taxes on sale of home – standard for all sales
  • Attorney fee (if you have one as the seller)
  • Title transfer fee – to transfer ownership to the buyer

 

While it may seem like buyers have to pay for a lot more when it comes to closing costs, this is not necessarily true. You see, the seller of the home generally covers the real estate agent commissions – yes, the selling and buying agent. It generally ends up in the 4-7% range of the total property value. This helps to balance out the distribution of closing costs between both parties involved.

 

Concluding on closing costs

While there are a number of different factors to consider, it can be tough to come up with an exact estimate of the closing costs. For help with this, you can use an online calculator to help you calculate your estimated closing costs.

 

Today's market is filled with many opportunities for the savvy investor. Our Elite Legacy Education trainers will introduce you to proven strategies that can help you launch your career as a successful real estate investor. Our Elite Legacy Education instructors will also discuss ways you can develop an "Elite Legacy Mindset".

Learn more about Real Estate Investing in our upcoming free interactive Online Training! Register Here



Want the live experience? Attend an upcoming free workshop coming to your area! Register Here

What Our Students Are Saying: Mind blowing class! Who knew! So many underutilized tools to get the job done. Motivated to take a new step. Donna H. Laurel, MD

Browse through our Rich Dad Education reviews by clicking above!

Founded in 1992, Elite Legacy Education is a recognized global leader in quality financial education.
Legacy Education Alliance, Inc. is a leading provider of educational training seminars, conferences and services.
Rich Dad Education offers real estate & stock training based on Robert Kiyosaki's book Rich Dad Poor Dad.

©2017 Elite Legacy Education. All Rights Reserved. The Elite word mark and logo are owned by LEA Brands, Inc. and their use is under license. Elite Legacy Education, Inc. is a subsidiary corporation of Legacy Education Alliance, Inc. The educational training program provided hereunder is not designed or intended to qualify students for employment. Our curriculum is avocational in nature and is intended for the purpose of the accumulation of wealth by, and the personal enrichment, development and enjoyment of, our students.

Privacy Policy | Terms | Cookies