How Do I Calculate Closing Costs ?
When it comes to closing costs, many people who take mortgage do not know what all adds up to these costs. However, knowing what closing costs involve and how to calculate them will give you a clear picture on how expensive a loan is.
So, how can you calculate the closing costs? The good news is that there are ways to do this calculation, but you need to have certain figures with you.
Check with the lender what are the charges levied on the loans. These charges differ from one state to the next and from lender to the next. Usually, when it comes to charges levied on the mortgage, it will include things like fees for property appraisal, cost of surveying the property, cost for running the credit check on the borrower, loan origination fees, fees for underwriting the loan and tax service fees. All these will be part of the closing costs. In addition, there are certain fees that have to be paid in advance for the entire year and will be made into part of the closing costs. These include interest, hazard insurance, private mortgage insurance and property taxes. In addition, even the charges for title transfer can be added to the closing costs.
Once you know all the fees that are included as a part of the closing costs, you just have to add them up in order to figure out what you will be paying in order to close the mortgage. There are some fees that are negotiable and you can negotiate these. If you succeed, you can bring down the overall closing costs.
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