| Closing costs are often the last thing a person | | | | for a loan that doesn't require you to pay points. |
| thinks of when buying a home. While closing is the | | | | Home and Title Insurance |
| joyous moment the home becomes yours, the | | | | Insurance for your home and title are a must. If |
| costs can be surprisingly aggravating. | | | | you are borrowing money to purchase the home, |
| When you purchase a home, condo or other | | | | each is mandatory. If you are using your own |
| property, you will go through a period known as | | | | funds, you should still get both forms of insurance. |
| escrow. During escrow, various issues related to | | | | As each name implies, they provide insurance |
| the property transfer are worked out. The last | | | | against issues involving your home and problems |
| day of escrow is known as the closing day and | | | | with the title transferred to you. You want to |
| you are going to be paying closing costs. | | | | have clear title. |
| Closing costs come in many forms. Some involve | | | | PMI |
| significant dollars while others are relatively | | | | Private Mortgage Insurance, "PMI", is mandatory if |
| painless. Here's a list of typical costs: | | | | your down payment is less than 20% of the |
| Escrow Fees | | | | purchase price. You can expect to pay a few |
| An escrow agent is essentially a third party that | | | | hundred dollars a year in PMI. |
| works with the seller and buyer to finalize the | | | | Inspections, Appraisals and Miscellaneous Fees |
| transaction. For this assistance, the escrow agent | | | | In the home purchase process, you are going to |
| will charge a fee. Depending on your area and the | | | | use a variety of services to validate the property |
| agent, you can expect fees from a few hundred | | | | is your dream home. These services come with |
| dollars to around a thousand or so. Make sure you | | | | fees and you can expect to pay for home |
| find out the fees before picking an escrow agent. | | | | inspectors, appraisers and the like. Depending upon |
| Home Loan | | | | the state you live in, many of these fees may be |
| Obtaining a home loan in the current market is a | | | | built into your mortgage. Nonetheless, you need to |
| highly subjective event. "Points" can be a major | | | | know exactly what you must pay for on closing |
| cost associated with home loans. Points are | | | | day so you can budget accordingly. |
| essentially a fee you pay or have build into the | | | | Closing escrow should be one of the happier days |
| loan for the privilege of being allowed to borrow | | | | in your life, particularly if it is for your first home. |
| money. A point usually equates to 1% of the loan. | | | | Make sure you know the costs associated with it |
| On a loan of $300,000, one point would equal | | | | so you don't have to spend the day running |
| $3,000. If you have excellent credit, you can shop | | | | around borrowing money. |