Step 4 The Closing Process
The following fees are required to be paid by the buyer at closing. These fees are standard in nearly all real estate transactions. Regardless of your Credit, it has little to do with any up front fees that must be paid.
| Down Payment: |
FHA: 97% Govt. 3% furnished by buyer. Buyer can waive the 3% with a gift or with Down Payment Assistance. |
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FHA is not credit score driven. |
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Conventional: 100% (Ranges from 80%-100% financing). Dependent upon type of financing. The Buyer will have to provide the up front cost. |
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Conventional loans are credit score driven. |
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A middle score of 580 would get 100% financing. |
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Closing Costs:
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2% – 3% of the Loan amount. Seller concession: 3% Max on most Conventional loans, and up to 6% for FHA. See Financial review for more details. |
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The Attorney:
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Regardless of who chooses the closing attorney, the attorney does not represent the buyer nor the seller in the transaction. The closing Attorney represents only the Lender. |
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The Realtor:
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Our Realtors( don't charge you anything to represent you. In most States (excluding Georgia), it is reported that some Buyers are still paying a commission to their Agent for representation. And despite most people's beliefs, the commission paid by the seller doesn't increase the loan amount at all. |
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Earnest Money:
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Depending on the amount of the property more earnest money could be required. There are no set guidelines on how much the amount the Earnest money should be. Typically, it can range from ($250-2,500). The earnest money is not a Realtors' fee, but it is applied towards the purchase price at the time of closing. Words of caution: should you fail to comply with certain terms of a contract, the earnest money becomes non-refundable. Consult with your professional Realtor accordingly. |
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Home Inspections:
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It is very important to make sure that your Home is fully inspected. Getting your home inspected is your choice and typically costs $150- $300. Our realtors know the importance a home inspection and we highly recommend that you get one. Most Buyers let the cost of a home inspection defer them from getting one. |
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Home Warranty:
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The home warranty is paid for by the Buyer and costs about $300-$400/ $0. If there is no existing warranty on the property, our Realtors will negotiate with the seller to provide you with a home warranty. When negotiated properly, the home warranty will cost you nothing. |
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| Home Owners Insurance: |
$300-700 (Required by lender) |
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| Termite Clearance Letter: |
$75 –100 (Required and supplied by the seller) |
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-Closing Costs Example-
Closing costs are typically 2% to 3% of the loan amount, and are dependent upon the type and dollar amount of the loan. If negotiated properly, the seller can pay your closing costs in full. The following items are included in your closing costs:
Lender Fees:
Home Purchase Example: Sales Price = $130,000 (Loan origination fee ¾ -1%, of loan amount $1,300)
| Credit Report |
$15 |
| Application |
$95 |
| Appraisal |
$225 |
| Administration Fee |
$350 |
| Tax Service Fee |
$77 |
| Flood Zone Certification Fee |
$7 |
| Processing Fee |
$100 |
| Closing Attorney Fees [$350 for purposes of this example] |
$350- $500 |
| Title Insurance |
$273 |
| Title Examination And Binder |
$200 |
| Home Owners Insurance [$300 for purposes of this example] |
$300-$700 |
Taxes:
Fees vary by state and Georgia requires an "intangibles" tax of $1.50 for each $500 of the loan amount. Then there's the "Georgia residential per-loan" fee of $6.50.
ESTIMATED CLOSING COSTS: $3,300.00
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