When buying a home in South Charlotte NC (or anywhere, for that matter!) buyers can expect to pay anywhere
from 1.5% to 3% of the purchase price in buyer closing costs. Every transaction is different, so be sure to carefully review your Good Faith Estimate provided by your lender. Many South Charlotte home buyers ask the sellers to pay some/all of their buyer closing costs. Closing cost assistance is negotiable between the buyer and the seller.
In addition to your down payment funds, here are some typical buyer closing costs associated with buying a home for sale in South Charlotte NC (remember, every transaction is DIFFERENT, and not all of these fees may be charged in YOUR transaction, so consult with your lender and your Realtor®!):
Buyer Closing Costs – Mortgage Related Costs
- Loan origination fee – this fee may be charged by your lender to cover the costs of making the loan. Loan origination charges may be a flat fee or a percentage of the loan.
- Points – Some lenders charge a “point” (sometimes referred to as “discount points”) which is a form of pre-paid interest on the mortgage loan. The more points you pay, the lower your interest rate on the mortgage, and vice versa. One point (1% of the loan) will lower your interest rate by 1/8%. Check with your financial advisor to see if paying points makes sense for you. Points may be deductible on your tax return.
- Loan application fee – Some lenders charge a loan application to get your loan process started; it may cover the initial costs of processing your loan request and checking your credit report.
- Appraisal – Your lender will require an appraisal for the home you wish to purchase. Appraisal fees in South Charlotte NC may range from $350 – $550.
- Credit Report – Before a lender can quote you an interest rate and loan package, he/she will have to pull credit scores for BOTH the borrower and co-borrower. Your credit score will determine whether you can qualify for the best interest rates. For more information on credit score impact on your mortgage, read my blog post “Your credit score – what you should know before buying a home in Charlotte NC.” This fee ranges from $15 – $30 per borrower.
- Flood certification fee – This fee is a for a service that tells the lender whether the home is in a flood plain or not. If it is, you can expect to pay for flood insurance. Flood certification fees range from $5 – $30.
- Tax service fee – This fee covers that cost of the lender setting up your tax escrow and monitoring the payment of your property taxes.
Items Required by Your Lender to be Paid in Advance
- Daily interim interest – these are per diem interest charges paid from closing day through the end of the month.
- Mortgage insurance premium – Your lender will require that you pay for a full year of homeowners insurance. Rates vary depending on the value of the home, your credit score, your claims history, etc.
- Mortgage insurance premium – If your downpayment is LESS than 20% of the purchase price, your lender may require private mortgage insurance. This insurance is credit score driven, and the lender may require an up-front lump sum PLUS a monthly premium.
- FHA mortgage insurance premium – FHA loans with less than 20% down will require a mortgage insurance premium of 1% of the loan amount. This lump sum payment can be folded into your mortgage
- VA funding fee – If you are using your VA benefit to purchase a home, you will be charged an upfront VA funding fee, which can be folded into your loan. If you have never used your VA eligibility, the fee is currently 2.15% of the loan. If you have used it before on a previous home, the funding fee is 3.3% of the loan.
Buyer Closing Costs – Reserves Deposited with Your Lender
- Homeowners insurance – If you are paying your homeowners insurance and property taxes through escrow with your mortgage company, your lender will require 3 months worth of homeowner’s insurance to be deposited into your escrow account at closing (this is in addition to the 1 year paid premium)
- Property taxes – In order to keep your escrow account funded, your lender will require 3 – 6 months worth of property taxes to be deposited into your escrow account at closing. Remember, you will also be paying your pro-rated amount of property taxes at closing for the current year. The seller will pay for an entire year of property taxes, but will receive a credit from the buyer at closing for the buyer’s portion of the bill (i.e., from day of closing to the end of the year.)
Buyer Closing Costs – Title Charges
- Attorney fee – Buyers choose their real estate attorney for settlement (NC is an attorney state, not a title state). Fees range from $650 – $750
- Title search fee – This may or may not be included in the attorney fee above. Fee ranges from $75 – $85
- Title insurance (both for lender and owner) – This fee insures that the lender and the owner are protected for claims against the title. NC title insurance fees are $2.05/$1,000 for the first $100,000; $1.60/$1,000 for the next $100,001 – $500,000; and $1.05/$1,000 for homes selling for $500,001 to $2 million.
Buyer Closing Costs – Government Recording and Transfer Charges
- Recording the deed – To record the new deed at the courthouse – $22 – $32
- Recording the deed of trust (mortgage) – Fee depends on # of pages; ranges from $60 – $
- Recording power of attorney – If one of the buyers cannot be present at closing. Fee is usually $50 – $75
Additional Settlement Charges
- Home inspection fees – Any fees that the buyer did not pay for at the time of service. This may include any and all home inspections, termite inspection, etc. Home inspection fees depend on the size of the home and how many additional services the buyer wants (range $400 – $500)
- Survey – Very important! A survey will reveal your property lines, lot setbacks, easements and encroachments. Fees range from $350 – $500
- Termite inspection – Some lenders still require a termite inspection, but because of the preva
lence of subterranean termites, in NC, I always recommend that my clients order a termite inspection. Fee: $65 – $85.
South Charlotte Real Estate Expert
South Charlotte NC is definitely a popular destination for people moving into the area. You’ll find beautiful neighborhoods and a thriving shopping, dining and recreation scene. Some of Charlotte’s best public schools are located in South Charlotte!
I’m a South Charlotte Realtor® – I live and work here, and it would be my pleasure to help you with your South Charlotte real estate needs. If you are thinking about selling your South Charlotte home, I would love to share my 21-point marketing plan that combines new technology with good old hard work! If you’re looking to buy a home in South Charlotte, please contact me so we can talk about finding the best home and neighborhood for YOU!
Come have a chat with me at my Helen Adams Realty office in the heart of Ballantyne at Ballantyne Commons East.I’m happy to put you in touch with some great mortgage lenders who can tell you more about buyer closing costs when buying a Charlotte NC home.
Helen Adams Realty
15235-J John J Delaney DR
Charlotte, NC 28277