What are Stafford Closing Costs?
There are a lot of fees involved in purchasing and selling a Stafford house. From the down payment to the cost of the house itself, it can be hard to budget just how much money you will need to buy, or how much money you will receive when you sell. The phrase “closing costs” is thrown around a lot by real estate agents and attorneys, but what does it really mean?
Closing costs are all of the third-party fees that you accumulate throughout the process of a Stafford real estate transaction. The typical total will range between 2% and 5% of the purchase price of the house. The more expensive the house is, the higher the closing costs are going to be.
What do closing costs include?
There are some fees that will be recurring fees for the new Stafford homeowner that they will begin to pay with their closing costs. This includes things like homeowners insurance and property taxes, which are often escrowed into the mortgage payment. Many loans will also include some prepaid loan interest in with closing costs.
Other fees are non-recurring fees that are included. These include the expense of the home inspection, origination fee from the lender, and filing fees. These are all one time fees that are happening because the sale of the house. There will be fees related to the title, the underwriters, and checking your credit.
There are fees throughout the entire process of a Stafford real estate transaction and most of them are added together and paid in or out during the closing process.
Are they set prices?
There are some fees that you will have little control over. There are other fees that you can negotiate.
Start this process by interviewing multiple lenders before you select which one you want to work with. Ask them what fees are involved in closing and find out what they charge. Then, when it comes time to have a home inspection and appraisal, do the due diligence work yourself instead of just using the person that they recommend to you.
Shop around to see what the difference in the prices are. Look for areas where you can save money. See where you can negotiate prices lower. It can be time consuming, but you will find areas that you can save money on your closing costs if you are willing to ask.
One of the largest fees that the seller is going to get hit with is the commission to the real estate agents. Usually this will be 6% of the purchase price of the house. The commission is generally split equally between the listing agent and the buyer’s agent.
Who pays more?
The majority of the closing costs are negotiable. If the market is in a buyer’s market, buyers hold the power and can ask sellers to cover the closing costs. However, many areas are in seller’s markets right now, which lowers the chance of that happening.
The buyer pays more of the line items when purchasing a house; however, the seller usually pays the larger amount since they are paying the real estate commission.
If you have any questions about closing costs and the fees involved, don’t be afraid to ask. Don’t stop until you get your answers and don’t be afraid to negotiate. Stafford real estate transactions are full of negotiations.