🔑 Typical Buyer's Costs in a Real Estate Transaction

1. Loan-Related Costs

• Origination fee: Charged by the lender for processing the loan (0.5%–1% of loan amount).

• Credit report fee: $25–$50.

• Appraisal fee: $300–$600 (paid to confirm the home's market value).

• Underwriting fee: Charged by the lender for evaluating the loan application.

• Discount points (optional): Paid to reduce your mortgage interest rate.

2. Title and Escrow Fees

• Escrow fee: Charged by the escrow company for handling funds and documents.

• Title insurance (lender's policy): Protects the lender from title issues.

• Recording fees: Paid to the county for recording the deed and mortgage.

3. Home-Related Expenses

• Home inspection: $250–$500 (optional but strongly recommended).

• Pest inspection: Often required by lenders (especially VA loans).

• Survey fee (in some states): Verifies property boundaries.

4. Prepaid Costs (Impounds)

• Homeowners insurance premium (first year paid upfront).

• Property taxes: A portion may need to be prepaid at closing.

• Prepaid interest: Covers the interest from closing day to the first mortgage payment.

• Escrow/reserve accounts: Lender may require reserves for taxes and insurance.

5. Other Potential Costs

• HOA transfer fees: If buying in a homeowners association.

• Attorney fees (in states where attorneys handle closings).

• Courier or wire transfer fees.

💵 How Much Are Buyer's Costs?

• Typically range 2%–5% of the home's purchase price.

• For a $300,000 home, expect $6,000 to $15,000 in buyer's closing costs.

🤝 Can These Costs Be Negotiated?

Yes. Buyers can:

• Negotiate with the seller to pay some or all closing costs.

• Shop lenders for better rates and lower fees.

• Apply for buyer assistance programs in certain states or localities.

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