Closing Costs? (Dallas, Austin: sales, hazard insurance, mortgage broker)

[Hunny15602]

Hi Everyone,

I realize this is not the easiest question to answer, but I was hoping to get a rough feel of what to expect before I buy a home in the Austin area. We were in Dallas last year checking out another relocation opportunity, and I had to get the pre-qual to make the realtor happy, so I just used the mortgage broker her recommended. We had told the realtor that $250K was our upper limit, and got the pre-approval we needed, but I was floored when the mortgage broker said that closing costs, w/the usual stuff escrowed, would run us $16K! That seemed really high to me, and I was trying to find out if this was just a broker w/pie in the sky fees, or if that's a true picture of what closing costs are like in TX. I'm from NY, where you might as well put 10% away for closing costs because everything is ridiculous out here, but I figured TX would be much better, even though I know it ranks 2nd highest w/regards to closing costs.

On the purchase of a $250K - $300K home, w/about 20% down and escrowing taxes & insurance, what sort of costs would I be looking at to close? What line items on the GFE are normal? What's a ballpark % to expect based on the home's final sale price? Can any recommend a good broker or bank rep?

Thanks so much!

[yukiko11]

Part of those closing costs are your brokers fee. That can be from 3%-7% of the purchase price. My advice is to call a broker in Austin and ask him the average closing costs in your price range not including the brokers fee. Then ask him the average brokers fee % range. The brokers fee is always negotiable.

[IDtoTX]

I'm wondering if part of it is the high property taxes since you are escrowing. We don't escrow and our closing costs were MUCH lower on a slightly higher sales price.

[jobert]

generally it's 1.5% for the sellers agent, 1.5% for the sellers agents co. 1.5% for the buyers agent, 1.5% for the buyers agents co.

This is 6% - par for the course. The title company may add admin fees of .5% for setting up and managing your escrow acct.

[jobert]

I just checked my math above, and it adds up to 16K for a 250K house

[TexasHorseLady]

The brokers' fees would be charged to the seller, not the buyer. (This assumes that you're not buying a FSBO, in which case that would be negotiated.)

The mortgage broker should have given you a good faith estimate (required by law) to show you what the various fees are. If you look at it, it should show you what the closing costs are likely to be.

$16,000 does seem high to me, but it depends on such things as what kind of loan you're getting, how much your lender requires in the way of paids up front, what day of the year you close (taxes are prorated between seller and buyer), and other variables.

[centralaustinite]

I just closed a refi (yay!) and our closing costs were about $7K -- that is without any broker's fee OR escrow (we pay property tax and hazard insurance ourselves), our fees include $100 to Travis County, $350 for a survey, another $300 in settlement costs, $700 in closing fees and one and half discount points. You could easily get to $16K with title insurance, escrow fees, etc.

[jobert]

Originally Posted by centralaustinite

I just closed a refi (yay!) and our closing costs were about $7K -- that is without any broker's fee OR escrow (we pay property tax and hazard insurance ourselves), our fees include $100 to Travis County, $350 for a survey, another $300 in settlement costs, $700 in closing fees and one and half discount points. You could easily get to $16K with title insurance, escrow fees, etc.

Congrats! Hold on to that house (and interest rate) and you are set, my friend.

what'd you get? 4.5%?

[centralaustinite]

Originally Posted by jobert

Congrats! Hold on to that house (and interest rate) and you are set, my friend.

what'd you get? 4.5%?

Yep.

[Hunny15602]

Originally Posted by TexasHorseLady

The brokers' fees would be charged to the seller, not the buyer. (This assumes that you're not buying a FSBO, in which case that would be negotiated.)

The mortgage broker should have given you a good faith estimate (required by law) to show you what the various fees are. If you look at it, it should show you what the closing costs are likely to be.

$16,000 does seem high to me, but it depends on such things as what kind of loan you're getting, how much your lender requires in the way of paids up front, what day of the year you close (taxes are prorated between seller and buyer), and other variables.

Thanks for your input - I was wondering why everyone was discussing the brokers' fee, as that is charged to the seller and generally part of the sale price.

In the Dallas case, we opted not to actually buy or move out there - the area my husband would have been working wasn't a good fit for him, so we never got to the GFE, or an offer on a home or anything (even though I did find the dream home...)

Not sure if this matters, but at the time they had floated us around to an FHA loan, even though our credit scores are easily over 800. I know that the interest rate he had quoted me was also really high for that time, but I just figured that this was a means to an end, and if we had moved forward, I would have shopped around for a better deal. But that $16K number stuck in my head, and it hurt! I own several properties in NYS, and I've tracked all my closing costs, and none were in that ballpark cost, even with the escrow items accounted for.