How Much Are Closing Costs?
This will vary depending on the lender that you choose. Many people get caught up in the game of “what is the best rate” when they should be looking at what are the closing costs and monthly payments going to be. If you put less than 20% down on a home, you will have to pay Private Mortgage Insurance (PMI) which can add close to $100 per month on your mortgage payment. However, you can opt for a slightly higher interest payment and have your lender pay for your PMI upfront. By doing this, you may actually save $65 per month on your mortgage by paying a higher interest rate.
On the typical loan, you will have from $1500 to $3000 in closing costs. This will vary depending on how many inspections you want to have done on the house to whether or not you pay points to get a lower mortgage rate. Your lender will explain your options.
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