Closing Costs

          The following list of costs is not meant to be exhaustive, but, rather, is a list of costs that should give you a reasonable approximation of the costs you may have to pay at or before closing.  Please note that banks differ in their costs.  Total closing costs are typically around 4% - 5% of the purchase price.

BANK FEES (Fees are deducted from the loan amount at closing unless otherwise specified): 

  1. Application Fee
  2. Origination Fee 
  3. Commitment Fee 
  4. Appraisal Fee
  5. Tax Service Fee
  6. Credit Report Fee
  7. Flood Search Fee
  8. Commitment Extension Fee
  9. Bank Attorney Fee

These are not bank fees, but will be deducted from the loan amount at closing:

Prepaid Interest (per diem interest on the mortgage loan from the date of closing to the last day of the month in which the closing takes place)

Property Taxes (if your lender is escrowing for taxes, your lender will require at least 2 to 4 months of property taxes to establish a tax escrow account)

Insurance (if your lender is escrowing for insurance, your lender will require at least 2 to 4 months of insurance to establish an insurance escrow account)

Mortgage Insurance Premium (In the event the amount of your mortgage is at least 80% of the purchase price, your lender will require at least 4 to 6 months of mortgage insurance to establish a mortgage insurance premium escrow account.  Mortgage insurance will not be required to be paid once the unpaid principal amount of the mortgage is less than 80% of the purchase price.)             

If you are financing, your lender will require you to pay for 1 year of property insurance prior to the closing date.
 

TITLE INSURANCE FEES (These are fees that you will be responsible to pay at closing)
Fee Title Insurance Policy:  When purchasing a property, it is highly recommended that you buy an owner’s policy of title insurance.  The premium is a one-time fee to be paid at closing.

Loan Title Insurance Policy:  If you have a mortgage financing part of the purchase price, your lender will require you to pay for a loan title insurance policy.  

To determine fee and loan title policy premiums for New York properties, please go to the following website:
www.federalstandardabstract.com

To determine fee and loan title policy premiums for New Jersey properties, please go to the following website:  
www.alphaadv.net

In addition to purchasing title insurance policies at closing, you will likely have to pay for the following fees in relation to title insurance:

Departmental Searches:  The title company will run judgment searches, bankruptcy searches, local governmental searches for the names of the buyer(s) and seller(s).  

Survey:  You will need a survey if you are financing your purchase.  Even if you were purchasing the property all cash, you should get a survey.  

Recording Fees:  The deed and mortgage, if you have a mortgage, will need to be recorded in the public records of the county in which the property is located.  The cost of recording a deed and mortgage varies depending on the county in which the property is located.  

Mortgage Tax:  In New York State, you will have to pay a tax to record a mortgage.  The amount of mortgage tax varies by county.  

Mansion Tax:  In New York and New Jersey, if the purchase price of the residential property (1 to 3 families) is $1,000,000.00 (One Million Dollars) or more you will have to pay a mansion tax.  In New York, the mansion tax is 1% of the purchase price.  In New Jersey the mansion tax is 1% of the purchase price and would apply in the purchase of a 1 to 4 family property and in the purchase of a singular cooperative unit.

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