Strategies to Lower Your Closing Costs

by Kathy Dulhagen 06/02/2019

The closing cost is the last sum of money home buyers to pay after which there will be no further payment. The closing price can be surprisingly huge. This bill ranges from 3% to 6% of the mortgage. Do the math, and this means that the closing cost on a $300,000 home is around $9,000 to $18,000.

It is understandable that many home buyers are eager to complete their payment and move in, but there is a need to compare prices just as you research prices of a similar product when you set to buy a refrigerator, TV, or a car. Here are some strategies that will enable you to lower your closing cost:

Request a ‘Loan Estimate’ from the Lender 

Asking your lender for a ‘Loan Estimate' form is the first step to take towards minimizing your closing cost. The ‘Loan Estimate' form is a three-page document that your lender will issue to you within three working days.

A loan estimate allows you to make a comparison between companies and also lets you some specific fees that are peculiar to the lender you have chosen.

Be aware of where the savings are 

You will find the total closing cost as well as the amount you need to close the loan at the base of the first page of the Loan Estimate form. Check page two, section C of the Loan Estimate form, there you find the heart of your savings.

Push back on the charges of the lender 

Some lenders might charge a flat fee that covers services like originating and underwriting while others charge may have a separate price for each of the services. There is no problem with charging a separate fee for such services, but when there are more than one or two lines of itemized charges, you should be cautious when dealing with such a mortgage company. Also, take note of the names of the fees, demand for a further explanation from your lender if you notice a charge with a vague title.

Ask your Seller to contribute 

You can ask your seller to provide money to meet your closing cost demands. However, this contribution depends mainly on the market situation as well as the home because sellers may not oblige if there is aggressive competition among buyers. 

Go for a mortgage without a closing cost 

Going for a no-closing-cost mortgage is another strategy to consider. If you don't have enough cash, a no-closing-cost mortgage will be of great benefit. This strategy works like this – you won't have to pay the closing cost, but it will add up to your monthly mortgage payment.

About the Author
Author

Kathy Dulhagen

 I relocated to Myrtle Beach, SC from New Jersey with my family in 2012, Started my real estate career in South Carolina as a licensed Realtor in 2013, received my Brokers License in SC & NC in 2018.

I am a dedicated professional with designations as a Seniors Real Estate Specialist (SRES) and Accredited Buyers Representative (ABR), I understand the importance of being a reliable and knowledgeable resource, acting with honesty and integrity for every client. I devote time to my community as well as my local association as a member of the Hospitality and Professional Education Committees.

I offer my clients knowledge and expertise and an exemplary approach to customer service that is second to none. My professional background in executive administration lends to a unique skill set in my attention to detail, my understanding of real estate law and consumer representation, as well as my ability to negotiate, without compromise, I am the REALTOR® to help you find the home of dreams.

I am a Full Time Licensed Real Estate Agent in South Carolina, a member of the National Association of Realtors, the South Carolina Association of Realtors, the Coastal Carolina Association of Realtors and the MLS (multiple listing service)

Specialties: 55 Places Partner Agent, Active Adult Communities, 55 Plus Communities, Buyer's Agent, Listing Agent, Relocation, New Home Sales Specialist

"Move to What Moves You"