How Much Are Closing Costs When Buying a House?

A lot of people look at real estate prices and wonder why more people aren’t home owners at any given point in time, and that has a lot to do with their inability to grasp the nuances of home buying and ownership in some way, shape or form. A big part of the reason why that is the case has to do with the fact that the price of a home is only a small part of what you are going to be expected to pay for it, and if you want to buy a home that is truly worth your while then suffice it to say that there would be certain fees and charges that you would also have to pay before all is said and done.

A great example of this that Mary Cheatham King often talks about has to do with closing costs during home buying. This would generally be between 3% to 6% of the final price of the mortgage that you are taking. A common misconception is that closing costs involve the total price of a home, but that’s not the case at all.

Rather, closing costs are calculated based on your mortgage after the down payment. Hence, if you are buying a $300,000 home, you would pay $60,000 as a down payment and your closing costs would be 3% to 6% of the $240,000 that’s left over. That means that you should expect to pay around $12,000 or so as closing costs which might seem like a lot but is necessary to enable banks to do business the right way and earn a profit for themselves as well as for shareholders.