I recently got an interesting question from a prospective client. The question was, “How much are closing costs?”
The reality is that closing costs are between 2% and 3% of the sale price. As a quick example, I have a transaction right now that I’m acting as the listing agent on. The place is a split-foyer home built in the 1980s. We priced this at $379,900, but the buyer came above list price at $385,000.
However, the buyer did ask for $7,000 from the seller in closing cost concession. It’s very common in our market that buyers ask up to 3%. As it turns out, $7,000 was not going to be enough for their closing costs.
With everything that’s included, the total amount needed for closing costs can actually add up to quite a lot. But, what exactly do closing costs include? In this case, the buyer’s closing costs were actually about $9,000.
It’s very common in our market that buyers ask up to 3%.
Appraisals and inspections are both going to be paid upfront, but you will be paying other fees at the actual closing table. As a buyer, you’re going to set up your escrow to pay property taxes and insurance. You may also have private mortgage insurance ( PMI) to pay for.
I’d like to provide you with an additional resource to help explain this. The Buyer Financial Blueprint is a fantastic report which you can find here. There is also a report for sellers which you can find here .
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.