What are the Different Closing Costs of a Real Estate Contract?

Posted byPaola Nadeau on Nov 2020 in Real estate and property | 0 comments

Your Ventnor real estate agent can help you shop for a home and get the best deal possible. There are many considerations for purchasing a home. If you are a first time home buyer, all of the terminology may be confusing. Here is some key closing costs of a real estate contract that will help you understanding the purchase process more clearly.

• Points – Points in a real estate contract are charged that may be applied to lower the interest rate you pay on your home mortgage loan when purchasing Ventnor real estate. It is fairly simple to figure how much a point will cost you. A point is one percent of the amount of your home loan. Your real estate agent can give you more advice about the advantages and disadvantages of paying points to reduce the interest rate of your loan.
• Application fee – You can expect to pay an application fee for any loan closing. This fee is for the lender and is applied to cover any loan processing costs or for the expense of obtaining your credit report. The application fee cost will vary depending on which mortgage company you are using.
• PMI Insurance – PMI, or private mortgage insurance is normally required if you are not paying at least 20 percent down on your home. Its sole purpose is to protect the lender should you default on your mortgage payments. Your lender may pay the insurance fee for you, but in return will charge you a higher interest rate.
• Appraisal Fee – The appraisal fee is the charge you pay for an appraisal of the property you are purchasing. The lender requires an appraisal of the property to make sure it is worth the amount of money they are lending you. You will receive your own copy of the home appraisal once it is completed. Appraisal fees vary but can run into the hundreds of dollars.
• Escrow funds – A simple way to think of escrow funds is to say this is money that you are giving to your lender in advance to pay for expenses including property taxes, flood insurance, and home owner’s insurance. Some lenders require you to put this money in escrow so their interests are protected. You have to put money into the escrow account, if it is required, at the time of closing.

These are only some of the closing fees you may pay at your loan closing. If you still have questions about purchasing Ventnor real estate, you should contact a licensed real estate broker. She can make sure all your rights are protected when it comes to the real estate contract and help you get the best purchase price possible.

If you need help in buying Ventnor real estate property and understanding the closing costs of a real estate contract, contact Linda Magarick. Linda Magarick is a licensed real estate broker trained in all the legal aspects of real estate. She can make sure you get the best deal possible when purchasing real estate. For professional help in purchasing real estate and for a complete listing on homes and condos, visit the website at, call 1-800-636-4508, or email lmagarick@aol.com.