What Should Buyers Expect to Pay in Closing Costs?
What Buyers Can Expect to Pay in Closing Costs
Costs to Sell a home in Peoria AZ are not too unlike any other American city. Seller usually pays the commission and the buyer deals with more line-item expenses.
It’s not too often that a buyer shows up at the closing table without knowing what their closing costs of the sale should be. From the moment we begin working with a new buyer or seller in the Phoenix Area we make sure one of the first things we do is discuss the cost of the purchase or proceeds of the sale. For buyers, their mortgage professional will evaluate all of their limits to determine what they can or can’t afford.
Phoenix Buyers Have a Higher Number of Closing Costs
The closer buyers and sellers arrive at an eminent closing date, the more accurate the bottom line number will be. Because buyers that finance their deal have a higher number of closing costs, the buyer is usually faced with line-item expenses which come from the cost of the loan and the title company.
A buyer should receive a loan estimate from their lender early into the process. In Arizona we call this a Truth in Lending. It’s a consumer protection mechanism put in place for Arizona Real Estate Buyers so they are aware of the true costs to finance the loan before they get to a point of no return within the transaction.
There should never be any surprises at closing. In addition to planning for the sale, many buyers use the information on the loan estimate to shop around for different lenders, costs and rates.
Whether you’re buying a condo in Scottsdale or a single family 5 bedroom home in North Phoenix, you will most likely see some of the following costs:
- HOA Transfer Fees
- Appraisal Fees
- Prepaid Interest
- Prorated Taxes
- Prepaid Insurance
- Credit Reporting Fees
- Bank Origination Fees
- Loan Processing Fees
- Maricopa County Recording Fees
- Title Insurance
- FHA MIP Insurance
- Notary Fee
- Title Fees
- And More
Your REALTOR, Loan Officer and Escrow Officer will cover these fees line by line and explain exactly what they are and how they affect your loan.
Buyers Can Ask Seller to Pay Some or All of Their Closing Costs
If you’re a buyer having difficulty coming up with your own closing costs, we can negotiate them with the Seller. Often the Seller doesn’t care whether the break comes off the sales price or assisting the Buyer with their closing costs. A credit for $5,000 to go toward closing costs will be a much greater bang for the buyer’s buck. The price reduction won’t amount to much more than a few dollars per month over the length of the home loan. But saving $5,000 at the closing will be money right back in the buyer’s pocket.
Sellers Costs Are Usually Higher
What about home sellers? Fewer line items but overall a higher amount of fees when you factor in the Broker Fee, Title Fee, Owner’s Title Policy, HOA Transfer Fees, taxes and the payoff on their existing loan(s) to name a few.
Need more information about what Home Buyers and Seller pay in closing costs? Speak with Troy Elston today, a local Peoria West USA Agent.
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About the Author: The above article, What Buyers Should Expect to Pay in Closing Costs? was written by Troy J. Elston, a licensed Realtor at West USA Realty, the premiere real estate brokerage based in Peoria Arizona. With years of experience in the real estate industry, Troy produces stunning results for home buyers and sellers. If you’re thinking of BUYING or SELLING a home in the Phoenix Area, Troy would love to share his knowledge and expertise with you.