Purchasing a home in Chapel Hill can be overwhelming if you are not familiar with the steps and costs involved in this life changing transaction. Many buyers and sellers are especially unfamiliar with what it is involved when it comes to closing costs.

If you are aware of these specific costs and budget for them, they won’t surprise you on closing day and cause you financial stress.

Below is a guide to some of the more standard costs that you may be faced with on closing day.

  • Loan Origination Fee or Points: These are the fees charged by the lender for generating your loan.
  • Broker Fee: These fees are occasionally combined into the Loan Origination Fee.
  • Credit Report: Lenders may require this fee up front to obtain and review your credit history. (Approx. $21 - $60)
  • Appraisal Fee: This fee is normally non-refundable and will vary depending on the value of the home.
  • Inspection Fee: Fees paid to have a Certified Home Inspector evaluate the structural and mechanical condition of the home.
  • Title Search: This search will provide verification that the seller owns the house you are buying.
  • Title Insurance: This fee insures against losses as a result of any title defects.
  • Prepaid Interest: To pay up the mortgage interest to the first of the following month.
  • Mortgage Insurance: Insurance to protect the lender in the event that the borrower (mortgager) is unable to repay the loan.

These are some of the most common costs involved with closing. Once you have applied for your loan, the lender will provide you with a Good Faith Estimate of what they anticipate the closing costs to be.

Be sure to do your homework and ask extensive questions about these items and your closing on your new North Carolina home will go much smoother on closing day.

 

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