Closing Costs with Caruso!

A question I get a lot from clients is “How are closing costs estimated?”  

First let me tell you what they are. Closing costs are financing and legal costs associated with a home mortgage. They can vary significantly by type of loan and by state.  A way to guesstimate is 3% of purchase price.

Closing costs will differ by the sale and where you live. You will have to pay for the Title search and Title Insurance. You also pay for the Appraisal. You will have to pay a Recording fee, Homeowner’s Insurance, the pro-rated Property Taxes and partial Monthly Interest.  

If your loan has points or Origination fees then those are paid at closing. 1 point or origination fee equals 1% of the loan value. Some lenders charge 2 or 3 points, so it’s a good idea to shop around and call different banks and mortgage companies. Ask a lot of questions about the loan and closing costs, so you won’t be surprised in the end. 

Lastly, there are the miscellaneous fees, which include a Wire Transfer fee, Flood Certification, Tax Service and Credit Report charges, Lender Doc Preparation fee, and Attorney fee.

A Good Faith Estimate (GFE) should be provided, and is required by law when applying for a loan, this estimate sheet will outline what your costs will be and help you in determining an accurate closing estimate. It’s a good idea if you’re a first time buyer to educate yourself, so ask a Realtor, Lender or search a book on Real Estate Purchases at your local library or bookstore. 

And thank you for making me Your Orange County Real Estate Connection.

Best regards,


Past President, Orange County Association of Realtors (949) 753-7900


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