Home Buyer Closing Costs - Southern California real estate
Home Buyer Closing Costs
The sum of the fees associated with the buying (or selling) of a home is referred to as the "closing costs." Certain fees are automatically assigned to either the buyer or the seller; other closing costs are either negotiable or dictated by local custom. Home buyer closing costs in Southern California can vary depending on many factors such as purchase price, commission (typically paid by the seller), and the location. The practice of who typically pays for certain closing costs varies by geographical area in the state of California, and in fact, throughout the country.
It is important to understand what you are obligated to pay for under the Purchase Agreement. Make sure you read the Purchase Agreement carefully! Ask your Realtor® for a copy of the Purchase Agreement before you write an offer, so that you have time to review the Purchase Agreement and clarify any questions you might have.
Some typical home buyer closing costs in Southern California may include the following. Note: what party pays for some of these costs may be negotiable under the Purchase Agreement, and may or may not be mandatory to be paid for by either the buyer or seller.
The most common of the home buyer closing
costs are the fees involved in the loan. When a home buyer applies for a loan, lenders are required to provide them with a good faith estimate of their
loan's closing costs. It is very important that you make sure you
fully understand what the fees are that are associated with your loan. The fees vary according to several factors, including the
amount of the loan, the type of loan they applied for and the terms of the
Purchase Agreement. Some of the closing costs, especially those associated with the
home loan application,
may be paid in advance.
Can you negotiate who pays for closing costs?
In addition to the sales price, home buyers and home sellers frequently include closing costs in their negotiations.
How do prorations work?
At the closing, certain costs are often prorated (or distributed) between buyer and seller. The most common proration
is for property taxes. This is because of the property tax due date.
The seller is "charged" for that portion of the property taxes when they own
the property, and the buyer's responsibility for the property taxes would typically
start as of the date the buyer owns the property. The escrow holder
would use the most recent property tax bill and at the close of escrow, the
escrow holder would prorate the amount due between the parties accordingly.
Understanding the property tax calendar:
Property taxes are due as follows in
the state of California :
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 This is not intended to be a complete
list of buyer's closing costs. Your actual buyer fees may be different as negotiated in your contract. Read your Purchase Agreement
and your lender's documents carefully and make sure you understand their terms. You may want to consult with an attorney,
CPA and/or other legal or financial advisor. Please read our Disclaimer.
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Author: Fran Vernon - of Fran and Rowena
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