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Old 12-17-2007, 02:59 PM
 
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Can anyone give me an idea about what the steps are in a typical closing and what types of closing costs there are on a purchase of a home for a buyer? In our area we have legal fees, mortgage tax, mortgage fees, title insurance fees, inspection fees, survey costs, home insurance paid up front, real estate tax escrow and a bazillion other costs. What kinds of costs are typical of a closing in the RDU area?
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Old 12-17-2007, 03:26 PM
 
Location: Wake Forest
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Closing costs are going to vary greatly based on a number of factors. First, in NC the closings are done at an attorneys office, and the buyer generally chooses the attorney. Sellers have the option of attending closing and they usually do, along with each parties real estate agent, and at times the lender for the buyer. The sellers can choose to have their own attorney, but do not necessarily need to do that.

So, the closing costs are going to vary based on the size of the loan you are getting, are you getting one loan or a first and second mortgage, which lender you choose and their fees, which insurance you choose, etc. Some insurance companies want a year of fees to bank, others do not, it all depends. A survey is optional and the fees vary depending on the company and the lot size, they probably average 275 for an acre or less, from what I have seen. Home inspections also vary depending on the company, and they too are optional (but I would say are necessary) I would say they are any where from 350 on up.

Honestly, you will get a better assessment by talking with a couple of different lenders in the area and see what type of estimate they can give you. I have seen enough closings to know that they can vary widely in price. In general, the attorney fee ranges from 400 to 550, from what I have seen.

Leigh
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Old 12-17-2007, 04:11 PM
 
Location: Garner
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Closing costs will vary depending on who you use, but generally they involve: loan origination fee (depends on who you use, and is negotiable), appraisal fee ($375), lender fee($400-600), one year of home owner's insurance, hazard and real estate escrows (fees for this will vary depending on what time of year you close), attorney fees ($400-500), title insurance ($2.00 per thousand, estimate), & recording fee ($85 estimate).

All of those are estimates. Inspection, like Leigh said, is up to you. (I would recommend as well) To really nail down exact figures you should speak with a few lenders/brokers, but this should give you an idea.
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Old 12-18-2007, 11:04 AM
 
579 posts, read 2,752,626 times
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Aren't there predatory lending laws in place that say that the closing costs can't exceed more that than X % now? I thought there was because when we were trying to purchase a home for my in-laws in the country, we were told by a broker that they wouldn't do loans under 60K for that reason because they wouldn't make enough money on the closing costs and for that small an amount, we'd have to go through a bank.

I'm trying to remember what ours were but our builder paid them so I don't I recall exactly what they were now. I think they were supposed to somewhere around 3K but on my closing statement they builder actually paid more than that... maybe 5K? It was a 150K home, btw.
HTH!
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Old 12-18-2007, 01:10 PM
 
Location: Garner
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The Predatory Lending Law maximum is 5% of the loan amount. You can still make money on a 60k loan, they most likely didn't want to bother with it, which is unfortunate.

Quote:
Originally Posted by raccemup View Post
Aren't there predatory lending laws in place that say that the closing costs can't exceed more that than X % now? I thought there was because when we were trying to purchase a home for my in-laws in the country, we were told by a broker that they wouldn't do loans under 60K for that reason because they wouldn't make enough money on the closing costs and for that small an amount, we'd have to go through a bank.

I'm trying to remember what ours were but our builder paid them so I don't I recall exactly what they were now. I think they were supposed to somewhere around 3K but on my closing statement they builder actually paid more than that... maybe 5K? It was a 150K home, btw.
HTH!
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Old 12-18-2007, 10:36 PM
 
Location: Norfolk, VA
1,036 posts, read 3,812,283 times
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Default 5% Cap

Quote:
Originally Posted by LoraK View Post
The Predatory Lending Law maximum is 5% of the loan amount. You can still make money on a 60k loan, they most likely didn't want to bother with it, which is unfortunate.

That is not what the law really says. The broker can not make more than 5%of the loan amount, in a combination of compensation paid to them by the lender (yield spread premium).

The law is to prevent brokers from running up fees, but the law realizes that 3rd party fees are required to close a loan and excludes them. So other costs, such as the appraisal, attorney fee, insurance, taxes, recording fee, lender underwriting fee (in most cases) are not included in the 5%.

That being said, every lender has puts a cap and even banks sometimes bump rates when loans go below certain thresholds like 100k or 75k. That is becuase although the cost of making and servicing a loan is the same regardless of the loan amount, the interest received is far less on smaller loans.
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Old 12-18-2007, 10:41 PM
 
Location: Norfolk, VA
1,036 posts, read 3,812,283 times
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Default Closing Steps

Quote:
Originally Posted by LisaZ View Post
Can anyone give me an idea about what the steps are in a typical closing and what types of closing costs there are on a purchase of a home for a buyer? In our area we have legal fees, mortgage tax, mortgage fees, title insurance fees, inspection fees, survey costs, home insurance paid up front, real estate tax escrow and a bazillion other costs. What kinds of costs are typical of a closing in the RDU area?

Your Realtor or loan officer should really walk you through this.... and a loan officer should provide you with a Good Faith Estimate (GFE) to give you an idea of these fees.

Many of the fees (especially 3rd party) are fixed regardless of the loan amount. An attorney and appraiser will charge the same for 50k or 500k loans in most cases. Some fees such as taxes and insurance for escrow accounts and title insurance do depend on the price range.

The costs you mentioned are pretty much the same ones charged here. To get a good estimate of these, contact a lender or send me a DM or email.
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