Team Sigura
Coldwell Banker Realty

Buyers closing costs

Fees

Paid to

Description

Pre-Paid costs

Homeowner's Insurance Premium (12 mo.)

Insurance company

This insurance protects you and the lender against loss due to fire, windstorm, and natural hazards. Lenders often require the borrower to bring to the closing a paid-up first year’s policy or to pay for the first year’s premium at closing

Prepaid Interest

Lender

This is the interest that accrues on the mortgage between the date of settlement and the first monthly payment due date, so be prepared to pay that amount at closing. It will depend on your loan size.

Property Taxes

County

Usually six months of county property taxes and any proration amount the seller already paid, if applicable

Home warranty (Optional)

Insurance company

Fee for an insurance policy to protect you from cost of unexpected failures to the major systems and appliances in your home.   

Title Fees

Escrow fee

Title company

The escrow company handles all the funds involved in the transaction. They make sure all parties pay and get paid appropriately. The escrow fee (also known as the settlement fee or closing fee) is based on the loan amount and/or purchase price, so expect to pay more on higher cost homes.

Lender's Title Insurance Policy

Title company

Protects the lender in case there’s an error in the title search and someone makes a claim of ownership on the property after it’s sold. Coverage lasts until the loan is paid off.

Owner Title Insurance Policy (Optional)

Title company

Consider this policy to protect yourself in case title problems or claims are made on your home after closing. The owner's coverage lasts as long as you or your heirs own the property.

Endorsements

Title company

This is add-on title insurance coverage required by the bank for items over and above basic coverage of the title policy

Notary Fee

Title company

If a mobile notary comes to you for signing then you will pay between $150-$200 for this service

Flood Determination (if applicable)

3rd party via title company

This is paid to a third party to determine if the property is located in a flood zone. If the property is found to be located within a flood zone, you will need to buy flood insurance. The insurance is paid separately.

Courier fee

Title company

Occasionally, lenders have documents hand-delivered or overnighted when gathering all of the documentation for processing your loan. This fee pays for those costs.

Loan Tie In fee

Title company

The fee compensates your escrow company for the additional work required to process your loan and dealing with the lender

Recording Service

Title company

This is the fee you pay the title company to actually carry the mortgage and the recording fee check to the courthouse/county and get it recorded.

Lender Fees

Discount Points

Lender

By paying discount points, you reduce the interest rate you pay over the life of your loan, which results in more competitive mortgage rates. The cost of one point equals 1% of the loan amount. Generally, paying points is worthwhile only if you plan to stay in the home for a long time. Otherwise, the upfront cost isn’t worth it.

Origination Fee/Processing Fee

Lender

The loan origination fee is a charge by the lender for evaluating and preparing your mortgage loan. This can cover document preparation, notary fees and the lender’s attorney fees. Expect to pay about 0.5%-1% of the amount you’re borrowing.

Underwriting

Lender

This fee covers the cost of researching whether or not to approve you for the loan

Appraisal

Appraisal company

Appraisal allows the lender to know if the property is worth as much as the amount you want to borrow.

Credit Report

3rd party

This fee covers the cost of a credit report, which shows your credit history. The lender uses the information in a credit report to help decide whether or not to approve your loan and how much money to lend you.

Other Fees

Recording Fee

County

Fees for legally recording the new deed and mortgage at the local county

City Transfer Tax

City

0.33 % of purchase price
In Santa Clara county only in Palo Alto, Mountain View and San Jose  (** refer to Measure E new city tax increase law in San Jose)