The lender must disclose a good faith estimate of all settlement
costs. A check to cover your closing costs will probably have to be a cashier’s
check. The title company or other entity conducting the closing will tell
you the required amount for:
Downpayment
Loan origination fees
Points, or loan discount fees, you pay to receive a lower interest rate
Appraisal fee
Credit report
Private mortgage insurance premium
Insurance escrow for homeowners insurance, if being paid as part of the
mortgage
Property tax escrow, if being paid as part of the mortgage. Lenders keep
funds for taxes and insurance in escrow accounts as they are paid with
the mortgage, then pay the insurance or taxes for you.
Deed recording fees
Title insurance policy premiums
Survey (if you order one)
Inspection fees—building inspection, termites, etc. (if you've
ordered them)
Notary fees
Prorations for your share of costs, such as property
taxes and homeowner association dues.
A Note About Prorations: Because such costs
are usually paid on either a monthly or yearly basis, you might have to pay
a bill for taxes and/or dues paid by the sellers before they moved. Proration
is a way for the sellers to pay you back or for you to pay them for monies
they may have paid in advance.
