We received our HUD-1 Settlement Statement earlier this week, which is a summary of our loan amount, the money we've already paid (Due Diligence Fee and Earnest Money, detailed last week), any credits we're receiving (referral credit, since we used our real estate company's rental services last year, and a small credit from the sellers toward the roof replacement), and the closing costs.
So, since I'm not going to get into the actual loan amount, lets talk closing costs.
This was one of the hardest things for us to really research ahead of time. There are just so many variables involved, that even your lender won't know the final amount until shortly before you close. However, when you sign your mortgage documents, they will give you a Good Faith Estimate, based on past experiences and standards, so you'll know pretty close what to expect your closing costs to look like.
Our Good Faith Estimate and our HUD-1 Closing Costs only differed by $702.52, with our closing costs being less than the Good Faith Estimate. This is mainly because we're receiving a $500 credit for using the in house broker, so really it was only off by $202.52. That's pretty dang good in my book, and is probably partly due to the fact that our lender has 14 years of experience doing GFEs.
Now to break down what is in our closing costs. These are coming straight from our HUD-1, and I've tried to link to the definitions of some of these, in case you don't know what they are.
Loan Origination Fee: 1% of the loan amount (which is pretty standard, it's usually 0.5%-2%)
Appraisal Fee: $400.00
Credit Reports: $34.00
Tax Service: $70.00
Flood Certification: $24.00
Interest Charges: $523.20
Homeowners Insurance (1 year): $979.00
Initial Deposit to Escrow Account: $1,310.58
Attorney Fee and Lender's Title Insurance: $1,104.90
Owner's Title Insurance: $128.70
Government Recording Charges: $94.00
Property Survey: $400.00
HOA Dues (1 year, pro rated): $80.60
Total Closing Costs: $5,148.98 + 1% of the loan amount
But don't forget the other costs we've incurred, detailed last week, since home inspections are an important expense to budget for.
Hopefully showing this will be helpful for some of you going through this process too. I know when we were researching what the closing costs might be, there were lots of articles estimating it would be around 2-5% of the sales price of the home. But that can be a pretty big swing between 2% and 5%, especially if you're trying to put a set percentage as your down payment, and at the same time leave a buffer in your savings account for home emergencies or repairs. So other than the loan origination fee, I thought I'd share the actual dollar amounts in our closing costs. I'm sure these things vary state to state and situation to situation, but at least it's something to look at as an example!
So, now that we know what our final closing costs are, we continue the waiting game. We've got our certified check for closing costs + down payment all ready to go for our Monday morning closing time, and just have to make it through waiting for the weekend to pass. Why, or why didn't we schedule our closing for a Friday, so we'd have the weekend to start working on the new house? Oh well, at least we're both taking half days on Monday, so we can go straight to our house as soon as we get the keys in our hot little hands!
