When you qualify for a mortgage, you’ll face a list of fees known as closing costs. These are third-party expenses related to the mortgage process and the purchase of the home.
What Are the Fees?
Typically, the fees cover state and government records requests, credit reports, attorney’s fees, the escrow deposit, and paperwork related to the mortgage application. In addition, inspection, surveying and appraisal expenses may be included.
If the sale has progressed to escrow, but does not go through, you may have to pay cancelation fees. You also may pay your lender a closing fee in exchange for a discount on your mortgage rate.
Who Pays Closing Costs?
As the buyer, and mortgagee, you’ll be responsible for the closing fees. With Veteran’s Administration loans, the seller may share some of these costs. In addition, a motivated seller may agree to pay a portion of your closing costs. In foreclosures or “short” housing sales, the seller sometimes offers to pay closing costs as an incentive to buyers. You may also be able to negotiate a discount on some of your lender’s fees, although the lender is not obligated to do so.