What Closing Fees Are the Buyer Responsible For?
There are a lot of fees associated with buying and selling a home. Luckily fees are split between the buyer and the seller, so no one is entirely responsible for paying for everything.
In Texas, the home buyer is responsible for the following closing fees:
Loan Origination Fees (optional) - About 1% of the sale price: These costs are related to any associated loan fees, including application fees and prepaid interest. While loans are optional, these will be present if a mortgage is secured.
Appraisal Fees - $300-$450: An appraisal determines the property's value and determines whether it is worth the seller's asking price. Appraisal fees are often paid via credit upfront.
Home Inspection - $550 -$800: Home inspections are limited, non-invasive examinations of a home's condition to determine the house's structural integrity. If the home inspection uncovers and issues, responsibility for updating the home can be negotiated by your realtor.
Credit Report - $50 to $60: This fee covers the cost for the lender to pull the buyer's credit history and credit score.
Survey (optional) - $350 and $500: Most lenders will require a property survey, which determines the location of any buildings and the property's boundaries. Costs typically vary based on lot size and type of property.
Recording Fees - Varies by county: This fee covers the costs of registering the sale and transfer of the property to the buyer. Once the transfer of the deed is recorded, it becomes public record.
Lender's Title Insurance - Though the seller is responsible for most of the insurance fees, the buyer is typically responsible for the policy that protects the lender.
Prepaid Costs (optional) - Varies by lender: In some cases, the lender may require the buyer to pay some costs like property taxes and homeowners insurance in advance.
Discount Points - Discount points are a type of prepaid interest that can be bought upfront to reduce the interest rate charged by the bank. These fees are negotiable and may be covered by the bank.
Underwriting Fees - $300-$750: This is the cost of the lender preparing the loan and associated paperwork for the buyer.
For more information, please read our blog about the closing costs the seller is responsible for.
Still have more questions about what you need to know as a home buyer? Contact me today, I’m always happy to help!