Purchasing or refinancing a home is a big financial decision, and just like buying a new car- the market rewards the educated buyer by allowing them to walk away with the best deal possible. During this process it’s important to understand the “why” behind each cost, and sometimes it can get overwhelming with so many factors in play.
When collecting loan estimates from different lenders, one critical factor you'll want to understand is the closing costs you’ll have to pay.
Closing costs, also known as Settlement Costs, are what legally transfer the homeownership to the lessee and can either be a time of enjoyment, or can cause great stress on new homeowners if not addressed early enough in the home buying process.When reviewing loan estimates from different lenders, you may notice their closing costs vary significantly.
When lenders estimate your closing costs, they are guessing that you will either pass each criteria, or be liable for the assessed items at closing time. This process requires a lot of upfront honesty from your lender, otherwise you can get hit with some pretty hefty costs when it comes time to seal the deal.
A credible mortgage lender will be sure to overestimate on associated costs when giving you a loan estimate to make sure that when it comes time to close, you walk out with the keys in hand and your budget intact. Check out this infographic to understand what factors you should be aware of when navigating closing costs.
What are some experiences you've had with closing costs in the past? Do you have any additional questions about closing costs? Give us a call at (888) 923-9911 for further help understanding your closing costs or let us know your thoughts in the comments section below.