How do Closing Costs Work?

There are certain standard costs associated with closing the sale of a home. Buyers usually pay these closing costs, as the sales contract specifies, however, depending on State law the seller will have to cover some of the closing costs. "Closing Costs" are the fees which cover the various services involved when you sell or buy a house. These fees can be paid out of pocket or indirectly by increasing the loan amount or charging a higher interest rate.

As the list below indicates, many of the costs result from getting your loan. Since Mortgage Contract Services Inc is highly experienced with mortgages and closings, we can help you understand your closing costs.

The Loan Estimate

Buyers will get a Loan Estimate three days from when the loan application is submitted to the lender. The Loan Estimate lays out information like estimated interest rates, payments and fees, closing costs and more. This estimate is not an approval, rather it's the first step toward getting your loan.

We review estimates with buyers almost every day, so we will be happy to answer your questions about closing costs.

Below you'll find a generic list of closing costs. We will provide a specific list of your closing costs when we give you an estimate.

Standard Closing Costs

• Obtaining YourCredit Report
• Interest Payment
• Escrow Fees
• Costs associated with "originating" your loan
• Points — A fee paid to lower your interest rate (optional)
• Appraisal Costs

• Transfer Taxes & Recording Fees
• Insurance

• Private Mortgage Insurance (PMI)
• Title Insurance
• Flood / Earthquake Insurance