I typically estimate that closing costs will be about 3.5% of the purchase price


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It sounds like you are not using a real estate agent in this sale or you would have an estimate. If you are getting a mortgage, the lender will give you and estimate of the closing costs. Most of the costs associated with closing are related to the mortgage loan such as origination fee, private mortgage insurance, etc. If you are paying cash the closing costs will be minimal such as attorney fee, title insurance, recording fees. In any event $5,900 would seem to be more than enough to cover this sale.

If you are paying cash and not using a real estate agent, please be sure to get a good closing attorney to handle the details. If you need a recommendation for a closing attorney let me know, I have several.

With all the answers and information you have received, I was wondering what you have decided. Just curious if I was able to help you.
Thanks.
Jean Thrasher
RealtySouth--Trussville
205-655-8877

You should be receiving information from both your mortgage/bank and from the agent who represents you that detail the expected closing cost, and the funds that will be needed to close the deal.

The mortgage/bank will give you amounts that are specific to the type loan you are expecting from them. The real estate agent will be giving you their estimate based on their experience in the area. Comparing those can tell you a lot about the agent and the mortgage bank.

Shopping for lower closing cost is not unusual. Some government backed loans, have the closing cost regulated.

Just did a $300,000 loan and closing costs were around $6400.

Seems like $5,900 is way high for a $100k loan. I wouldn't think they'd be that high.

We're fully licensed in AL, if you would like a good faith estimate, give me a call. I'm sure I could place your loan without those kinds of closing costs. I can give you a quick estimate and let you know exactly what to expect at the closing table. If the seller is willing to pay up to $5,900 in closing costs, you shouldn't have any at all...

Look forward to hearing from you!

Kellen Gracey
BayBurg Financial
(386)237-7231 Cell
(866)230-8050 Toll Free (ext 214)
(954)764-7064 Office (ext 214)

I see you have received great advise. What have you decided to do?

On the average closing costs are 2-3% of the purchase price. If you are doing an FHA loan some of the cost may have been included in that. Or it may have to do with credit score and trying to get a better interest rate. Please check with a reputable mortgage agent. If you have any questions please e-mail me at pattyboyd@ymail.com. Thanks and have a great day!

Closing costs should not run anymore than 3-5%, depending on your tax escrow amount. Sit down with a mortgage broker to discuss.

I am a mortgage broker. If I can be of service, please let me know!

MSmith@PrecisionFundingUSA.com

Marty

Your credit score may be a factor in your closing costs but even then, this seems to be way out of line for your closing costs. The contract we wrote yesterday is for $191,540 & their closing costs is not even $5900. I would advise you to check with another mortgage company. I hope you meant that the buyer would pay UP TO $5900 closing costs including prepaids, closing costs and maybe your 2% rural application fee. I will be glad to answer any questions you may have. Please give me a call at 655-8877 or email me if that will suit you better.
Jean Thrasher
223-5570

If you are using a Buyer's Agent, they should be able to figure your closing costs for you. If you are not using a Buyer's agent, let me ask you - Why Not?

As new home buyers, let me explain how this all works, incase you do not understand, as a lot people do not.

If you just drive around and call an agent off of a sign from in front of a home with a For Sale Sign on it, that agent represents the Sellers and will be looking out for the Seller’s best interest - hence the term Selling Agent or Listing Agent.

NOTE: If you do do this, make sure you enter into a Limited Consensual Dual Agent agreement and not just a Transaction Broker Agreement - Explained on the bottom.

A Buyer’s Agent will be looking out for YOUR best interest.

How do they get paid? – Good question, as most people also do not understand this.

No sale, no pay! They do not get paid by the Buyers, nor do they truly get paid by the Sellers. They get paid by what the Seller’s Agent is willing to share with the Buyer’s Agent (Disclosed in a section of the MLS that only other Realtors can see) of what he or she is getting paid by the home’s owner.

Won’t using a Buyer’s Agent change the price we are going to pay? – The answer is NO and here’s why.

A Seller’s Agent makes a deal with the Sellers to list, market and sell the home for a percentage of the sale’s price, let say 6%. The Sellers are going to pay 6% no matter if a Buyer’s Agent is used or not. What it comes down to is, will the Seller’s Agent keep all 6% by selling the home to a Buyer that has no representation, or keep only some of it by sharing it with a Buyer’s Agent? Seller’s Agents do this to get more people to look at the home and get it sold faster.

I hope this all makes sense!

If you are in the Birmingham, Alabama area and are looking for a great Buyer’s Agent, give me a call or send me an e-mail. If you are not in the Birmingham, Alabama area, give me a call or send me an e-mail anyway, I know top agents all over North America!

A Limited Consensual Dual Agent will work for both the buyer and the seller amd is loyal to both. The ONLY thing a Limited Consensual Dual Agent can not do, is tell the bottom line to either party, which a Single Agent would not know anyway.

A Transaction Broker will just assist either the Buyer or Seller, depending on who they have the agreement with, with the sale or purchase of a home. They still need to provide you with honest service and act in good faith, exercise reasonable care and skill, keep confidential any information gained in confidence, unless disclosure is required by law or duty to a client, Present all written offers promptly yo the Seller and answer all your questions completely and accurately. NOTE: ”unless disclosure is required by law or duty to a client” If this agent is a Single Agent to the Seller or Buyer and only a Transaction Broker to you, ANYTHING you tell them, can be relayed back to the party they represent.

Your closing cost shoul be less than that I have one that we just got under contract yesterday and the closing cost are $5100 on a $171K property.

If your lender is trying to make you pay more than say $4500 I would question them and find a new lender.

Orgination fee $1000.00
Appraisal fee $ 400.00
Credit report $ 35.00
Processing fee $ 295.00
Tax service $ 82.00
Underwriting $ 495.00
Closing and $ 500.00
title search
Title insurance $ 450.00
Mis Taxes $ 200.00
Escrow setup $ 800.00
Mis fees $ 250.00

Just estimates but something to look at i would get a good faith from at least 3 lenders don't put 3 applications in but give them your credit score and get the cost. I think $5900 is way out of line give me a call if you need 2 or 3 lender ref.

Barry Lynn Miller
205-338-5555