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Closing Costs: Who Is Paying?

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By : Roby Hicks    99 or more times read
There are several things you need to consider when purchasing a home. First, you need to make sure that you qualify for a loan. Next, you have to look for the right lender. This will give you an idea of the price range of the property you can afford. After that, you will start looking for your ideal home. When you find the house, you will negotiate and make an offer. The closing follows.

The closing is an essential part of the entire transaction, as the ownership of the property will be transferred to you during this time. However, before that happens, you need to settle the closing costs. These are the costs associated with your mortgage and the other activities related to the purchase. If you have a real estate agent, he should be able to explain this to you. Who will pay for the closing costs? The answer would be the buyer. But wait, you can have the seller pay for a portion of it too. Here are some tips:

The Good Faith Estimate (GFE)

It is essential that you ask for a GFE from your lender before you borrow money from them. This is essential so that you will have an idea of how much you can borrow and how much it would cost you. You will be able to acquire GFE easily because the government requires that all borrowers should be given such estimates. The lenders will have to notify you too if they are going to change the rates and fees.

The GFE is extremely helpful when it comes to learning about how much you should prepare during the closing. But most importantly, it allows you to choose the right lender for your needs. You can compare the different GFEs from different lenders and pick one that fits your needs best.

Asking the seller to pay a portion of the closing costs:
In this type of market, it would be wise for buyers to ask the seller to pay a part of the closing costs. Most buyers use this during the negotiation process. They make better offer, though not necessarily higher than the value of the property. If you were a buyer who makes a good offer, the seller would likely be more open to discuss paying for a portion of the closing costs. Most sellers are up for this because they know how difficult it is to find a buyer who will make a good offer for the property.

If the seller agrees to pay a portion of the closing costs, see to it that you put it on writing. It is also essential that the amount to be paid is clear. Detailing everything will prevent any problems during the closing.

Closing is an important stage of the property purchase. If things go wrong during this stage, the ownership of the property will not be transferred to you. This is why it is essential that you know how much the closing costs are beforehand. You need to agree with the seller as well. You have to be clear with him in terms of the fees he will pay and the total amount he will be paying to avoid problems during the closing.
Check out the Wickenburg Pool Real Estate. Visit the Scenic Property in Wickenburg, AZ and the Wickenberg Luxury Real Estate as well for your next purchase.

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