Closing Costs... why do I have to pay so much?

My lawyer estimated it to be 28,000 and my mortgage broker 21,000. I am doing an FHA loan so Im putting down 3.5%. I still need to put down another 6,000. Take that away and thats still 15 to 22,000!

A lady at work and I talk every day and her daughter is in the same boat as I am. She was buying a house, put 3.5% down. Her home price was 30k more than mine and she only paid 9K in closing costs and used Chase.

Does anyone know why?

I really dont feel like I know what Im doing and am afraid of getting scammed. I am using a mortgage broker.

Re: Closing Costs... why do I have to pay so much?

Does it have to do with the property taxes?

Re: Closing Costs... why do I have to pay so much?

did you get the Good Faith Estimate? it should break down all the costs.

a lot of it is taxes (more or less, depending on when you're closing)

also includes:

loan fees
title fees
closing fees
recording/govt fees

Re: Closing Costs... why do I have to pay so much?

You should get a detailed estimate of your closing costs, once you know the details you can see if something isn't right. What are the taxes on the house you are buying that could be a big part of closing costs.

Re: Closing Costs... why do I have to pay so much?

Shop around for the title insurance costs and try to neg. the lender fees.

The bulk of the cost should be advance payment of re taxes and the first month of loan.

Re: Closing Costs... why do I have to pay so much?

If I remember correct, mine were estimates at around $19k too. And to be honest, when everything was broken down, it all made sense. You have to figure that a lot of that is property/school taxes, so that could be half right there. Then a year of homeowners insurance. Then first months payment. Add a few little fees in there and it adds up pretty quick.

Then I walked out of closing, I wasn't really sure how much I paid...haha

I just checked my final docs and it said hat I paid $17,209 in closing expenses. That also included the Attorney fee.

Re: Closing Costs... why do I have to pay so much?

Im just wondering why someone who was purchasing a home more than mine, and paid the same towards it 3.5 % would have to pay MUCH less than me. The taxes on the house are 8,900 after star. So Id say 9,900. So talk to me about taxes. If I buy before the end of December I have to pay a lot more than if I buy in january??? Im confused.

Re: Closing Costs... why do I have to pay so much?

If you are using a broker, the fees are alot more as opposed to bank.

Our first home was $360K, we put down 20% and our closing costs were 21K.

Our second home was a lot more than my first, we still put 20% down the taxes were the same and we paid $9K for our closing costs.

The only different was we used a bank the second time and shopped it our selves.

Re: Closing Costs... why do I have to pay so much?

I'll offer one distinct possibility.

Are you escrow your mortgage/taxes now? If you are and plan to do the same with a new bank the bulk of that is most likely escrows. Could be as much as 5-8k.

You need to pay that up front. HOWEVER did you check the balance in your existing escrow account? You may have the same 5-8k in that and if you switch banks that money will get refunded. So you offset you closing costs maybe only pay a net 10-13k.

Re: Closing Costs... why do I have to pay so much?

Re: Closing Costs... why do I have to pay so much?

Re: Closing Costs... why do I have to pay so much?

A lot of the responses you are getting are fairly accurate. Most of the costs you will pay at closing will be to front load the escrow account to pay future taxes and homeowners insurance, but the amount that goes in depends on two things 1. where the property is located (nassau or suffolk county) 2. how high the property taxes are where you are purchasing. Then you will have your bank closing costs which are typically the appraisal credit report, origination charge, and any points you may have to pay, if you are not paying points then this should run you anywhere from 1500-2000 for all charges. Since you are doing an FHA loan, I can only assume you are financing the upfront MIP that needs to be paid which is typically 1 percent of the loan amount. e.g. if you are taking a loan for 360k, your upfront MIP will be 3600 but your final loan amount will be 363,600 because you are financing that MIP. If you are not financing it than you will have to pay the MIP out of the loan proceeds. The rest of your closing costs should be the title company fees, bank atty fee and your atty fee. The title company fees, not including the title insurance, lenders title insurance and NYS Mortgage tax should run you about 1300, if you needed to get a new survey done on the property that could increase the title company fees to
2000 (surveys can range from 5-700). The title insurance and lenders insurance are all regulated by NYS state law and are based on the purchase price and loan amount usually running about 2300 for the combination. The NYS mortgage tax is basically B.S. its a way for the counties to tax a homeowner when they need to get a mortgage recorded on their property, in Nassau and Suffolk its .8 percent of the loan amount, so on a 360 loan it comes out to just under 3K. Also you need to take into account thatif any taxes are due within 60 days of closing your bank will require they be paid at closing as well. Depedning upon what county you are in and what taxes are being paid your seller might have to give an adjustment back to you. If you have any questions feel free to FM me, I know this can be overwhelming but I would be more than happy to help. Good Luck.

Re: Closing Costs... why do I have to pay so much?