What fees are included in closing costs?

Buyer closing costs fall into several categories. Loan costs include the origination fee (typically 1% of the loan amount), points (if you chose to buy down your rate), appraisal fee ($400 to $700), credit report fee ($30 to $50), and flood certification fee. Other costs include title insurance (lender's and owner's policies), attorney fees, recording fees, and transfer taxes. Prepaid items include property taxes prorated from closing date to the end of the tax period, homeowners insurance premiums for the first year, mortgage interest that accrues between closing and your first payment, and escrow deposits for future taxes and insurance. You may also pay for a survey, home inspection, radon test, and termite inspection. Some of these fees are negotiable, and you can ask the seller to contribute toward closing costs as part of your offer. Your Loan Estimate and Closing Disclosure will itemize every fee so you know exactly what you are paying.