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A Home Buyer’s Guide to Closing Costs

About Paying Closing Costs

12 May 2022
Closing costs can be a significant expense for buyers that can easily be overlooked or forgotten. Before you make such a large financial purchase, it’s a good idea to have a solid handle on what you are expected to pay at the closing table. To help, we’ve put together a buyer’s guide to closing costs. From what they are and what’s included to what you can expect to pay, we’ve got you covered.
What are closing costs?
The mortgage payment and down payments aren’t the only costs associated with purchasing a home. These other fees, together, make up your closing costs, which are due when you close on your home loan. Closing costs cover a wide range of fees, including the cost of your home inspection and appraisal, fees associated with your loan, and more.
Different types of closing costs
Of course, there are always exceptions and no two transactions in San Diego are identical; however, in general, there are five types of closing costs and fees that you can expect to see:
• Title fees (or attorney fees)

• Property taxes and homeowners insurance

• Mortgage insurance

• Lender fees

• Property-related fees

Who pays the closing costs?
When you think of closing costs, you often think of the buyer is responsible for covering these fees. In reality, however, both buyer and seller are usually responsible for paying closing costs. The seller will typically pay for real estate agent commissions and title transfer fees.

On the other hand, the buyer typically pays the mortgage fees, appraisal fees, and inspection fees. Of course, these fees are all negotiable, and sometimes the closing costs are worked into sales negotiations, with a seller agreeing to pay a portion, or even all, of the expenses.
How much are closing costs?
In the first half of 2021, the national average in closing costs for single-family homes was up more than 12 percent year over year, including taxes. With this in mind, it’s more important than ever to understand exactly how much you should budget for your closing costs. On average, closing costs for the buyer run between 2% and 5% of the total loan amount.
When buying a home, you have the option of paying these closing costs as a one-time, out-of-pocket expense at closing. You may also have the option of rolling your closing costs into the amount financed; however, keep in mind that you will be paying interest on these closing costs over the lifetime of your home loan, if you choose to go this route.

Portia Green, REALTOR®

Portia’s clients all have a similar story. Most likely, you met her huddled around a tablet at the dinner table yet she feels like a friend. Her personable nature and easy going approach attract Sellers and Buyers alike, in what can be a stressful and emotionally charged event. A talented REALTOR® with 15 years experience, Portia is just as excited about real estate today as she was with her first transaction. She remains ever-committed to helping her clients find their place in the world and helping busy people navigate this crazy real estate market like a pro.

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