Here is an explanation of who pays what in closing costs in a transaction.
Closing costs are a term for several taxes and fees that are incurred at the end of a real estate transaction. They’re paid when the transaction is ready to close and title is ready to transfer from a seller to a buyer.
The majority of buyer closing costs are associated with the buyer and their lender. At closing, buyers can expect to pay 2% to 5% of a home’s sale price in closing costs. The seller pays the majority of the title insurance that’s required when a buyer is obtaining a mortgage on a property. It’s negotiable who pays for the majority of the title insurance, but typically it is a seller’s expense.
Closing costs are paid when a transaction is ready to close.
In Texas, companies are regulated by how much they can charge for title insurance, so it’s not necessary to “shop” title companies because they all charge the same thing. Although it can vary, sellers can expect to pay around 7% of the home’s sale price in closing costs.
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