Closing costs are generally presented to a buyer in the form of a “good faith” estimate.  This is provided by a lender or lender’s representative at the time a mortgage loan application is taken.  The estimated costs and actual costs may be slightly different but any significant variation is cause for concern and might result in a delayed closing.

Closing costs are formally itemized on a HUD* settlement form nationally known as the “closing settlement” form.  There are two sides of this form, one for the Buyer and the other side for the Seller.  The numbers are reconciled by a closing company and in Massachusetts generally by the bank’s attorney. 

These are the most common items that a Buyer will see:

              1.       loan origination fee

              2.       appraisal fee

              3.       credit report

              4.       survey report

              5.       mortgage insurance (escrow)

              6.       mortgage insurance premium (escrow)

              7.       hazard insurance (escrow)

              8.       real estate taxes (escrow)

              9.       title examination

            10.       attorney fees

            11.       title insurance (lender and/or owner policy)

            12.       recording fee

            13.       Municipal Lien Certificate recording

            14.       adjustment of real estate taxes

            15        adjustment of water, sewer, trash, fuel, HOA fees

These closing costs are generally paid in full by the Buyer but there are exceptions to this rule.  Talk to your lender to determine if you qualify and what the allowed exceptions to this rule might be.  Beyond qualifying, having the Seller pay any portion of closing costs for a Buyer is a mutual agreement between both Buyer and Seller.  This agreement has been stated as part of the Purchase and Sales Agreement.   Retain this form until tax time as there are items that may be used as a tax deduction.

 *US Dept of Housing and Urban Development

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