Real Estate Closing Costs & Other Mandatory Charges


You pay several fees at the time of buying and selling a house. The cost of the deal finalization and transfer of the property in the buyer’s name is included. In other words, we can say that various legal & administrative processes are mandatory to close the deal & there are also fees associated with that process. 

There are a few things to keep in mind for navigation purposes of the closing cost on the property. You can sell your home on nominal listing fees and get a cashback refund on buying. DNT Home Buyers ensure considerable savings in this process and finalize an excellent deal for you. 

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Working Of A Closing Cost 

Before further discussing the closing cost, it is essential to understand the working of a closing price. 

After finalizing the home deal, both buyer & seller pay a grouping of charges and exchange-related expenses called “Closing Cost.” What is the actual cost depends on the area where you are living. Real estate laws & local rules & regulations impact the fees & charges. Real estate closing cost varies for every house size & location.

Types Of Fees Include in Closing Cost

Following are the major types of fees involved in this whole process. 

  1. Prepaid Cost 
  2. Title & settlement fees 
  3. Loan Cost 
  4. Transfer taxes
  5. Recording Fees 

Experts suggest that first-time home buyers ask the seller to pay their closing cost on their behalf if they dont have enough funds. Experts recommend this because, according to the market trend, sometimes sellers proactively offer to pay the closing cost for expanding the buyer’s pool. 

Seller’s Closing Cost 

Sellers also need to pay the closing cost. They are not fully exempted. The seller’s closing cost is estimated at 7 to 10% of the selling price. Sellers also have to manage things.

Real Estate Commission

Generally, the seller will pay a real estate commission for itself & on behalf of the buyer as well.  Usually, the commission rate is between 4 to 6 % of the final selling price. There might be a possibility to reduce or eliminate this cost through effective negotiation. 

Transfer Taxes & Fees

It is also known as the title fee. This is the amount you need to pay when your house will be transferred to your name. Most cases reflect that the seller paid that cost, and its cost varies from estate to estate.  

Title Insurance Premiums 

Before selling, a title search should be led to check possession. This titling strategy safeguards everybody against possession claims. The dealer is liable for the expenses and charges engaged with the pursuit and debates, assuming any emerge. Title protection is a one-time installment that shields from issues that could arise at the buying point or later on. If your residing period is less than ten years in your house, then it is feasible to request a decreased rate.

Buyer’s Closing Cost 

Generally, the buyer pays fees related to the loan, insurance & property because it is his responsibility. Usually, the closing cost of the buyers lies between 2 to 5 %.  Following is the breakdown of the charges from the buyer’s perspective.

Mortgage fee

It is the buyer’s responsibility to pay the mortgage fees. The closing disclosure will reflect the cost associated with the mortgage & final terms. Carefully read the terms and conditions. If you disagree with any clause, there will be three days to dispute the matter. 

Insurance Charges

The expense of your home loan protection will rely on the amount of an upfront installment you are making and the home loan type—the more modest the upfront installment, the bigger the risk and the higher the protection.  If you are willing to avoid this cost, you can easily do that by making your downpayment 20%. 

Property Fees

The buyer’s responsibility is also the appraisal, survey fees, and home inspection. The buyer is also responsible for any unpaid property tax. Suppose a buyer purchases a house at the year-end and will only pay what is left in that year. Therefore it is compulsory for buyers to counter-verify each and everything to avoid any inconvenience in the future.  

How To Save On Closing Costs 

The following are the ways to reduce your closing cost. 

  • Effective negotiation for saving the closing cost
  • Shop around to get competitive market rates on title services
  • Try to get a discount on the listing fee & homebuyer rebate 
Selling a house


Closing costs working and saving techniques & methods will be beneficial for first-time home buyers. A detailed analysis of the role of the closing price and how & when it is required to pay will clarify new entrants to the real estate market. Buyer’s and seller’s closing costs explain for a better understanding by a layman,  including other types of charges included in the closing costs. 

FAQ Section 

Question. How much are real estate closing costs?

Answer. Real estate closing cost is different for every home sale. Usually, it falls between 1.5 to 4% of the house value. House location is the main reason behind it. 

Question. Who pays the real estate closing costs? 

Answer. Usually, the buyer pays the closing cost, but the seller covers the real estate agent’s commission.

Question. Which is the most expensive cost for the buyer?

Answer. The most expensive cost for the buyer is the lender fee. 

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