The Ultimate Guide to Closing Costs: Who Pays and What to Expect

The Ultimate Guide to Closing Costs: Who Pays and What to Expect

The Ultimate Guide to Closing Costs: Who Pays and What to Expect

Hey there, future homeowners! 🏡

As you approach the finish line in your home buying journey, there's one more hurdle to cross: closing costs. Let's break down what they are, who pays for them, and what you can expect during this final stage.

Understanding Closing Costs

Closing costs are the fees and expenses you pay when finalizing your home purchase, typically ranging from 3% to 4% of the home's purchase price. They include a variety of charges such as loan origination fees, title insurance, and appraisal fees.

Who Pays the Closing Costs?

Traditionally, the buyer covers most of their own closing costs, but it's not uncommon for sellers to pay some of the fees (called seller concessions or closing costs assistance), especially in a buyer's market. It's all about negotiation!

Itemized Breakdown of Closing Costs

Here, we delve into the most common closing costs you might encounter:

  • Loan Origination Fee: This is charged by the lender to process your loan.
  • Appraisal Fee: Pays for the home's appraisal to determine its value.
  • Title Insurance: Protects the lender and buyer from title disputes.
  • Pre-paids: Lender collects between 3 & 9 months worth of Taxes and Insurance for Escrow.
  • Recording Fees: Charged by the local recording office to record the public land records.

Tips to Save on Closing Costs

  • Shop Around: Compare closing costs from different lenders to find the best deal.
  • Negotiate with the Seller: You might be able to get the seller to cover some of the costs.
  • Homes for Heroes: Work with an agent (like us!) that will credit a portion of their commission back to you to help offset closing costs and pre-paids!


Understanding closing costs and how to navigate them can save you money and stress as you finalize your home purchase. Remember, knowledge is power, especially when it comes to home buying!

Feel free to reach out with any questions or for personalized advice. Here's to a smooth closing process and stepping into your new home soon! Cheers! 🎉

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