Average Closing Costs in Burbank: What Do Closing Costs Entail?

What Are Closing Costs?

Many people believe that to buy a home, you only need to save for a down payment. Then, you get approved for a loan, and boom! The house is yours. However, don’t be surprised to find additional fees attached to buying a home called closing costs.

If you are a buyer in Los Angeles county, you can expect to pay between 2%-3% of your purchase price in closing costs. Some of these costs vary depending on your sale price, your down payment amount, property taxes, and your lender. Keep reading to learn all about what you have to pay in closing costs as a buyer.

What Is Included in Closing Costs?

Several factors are involved in determining the closing cost of your new home. Keep reading to learn about a few of these different factors.

Mortgage Origination Fees

When you get a loan for a mortgage, there are several costs that are associated with underwriting your loan. Depending on your lender, these fees can vary, but are usually between $1800 and $2000.

Escrow Fees

There are several fees that you might have to pay to your escrow company that depend on the purchase price of the home. Some companies charge between a $200 base fee and a $250 base fee, with fees between $2 and $2.50 per $1000 of the purchase price. For example, a million dollar home in Los Angeles might cost you between $2200 and $2750.

Appraisal Fee

In order to purchase a home, you need an appraisal to ensure that the property is worth the purchase price. While your lender will be the one who hires the appraiser, you are the one who pays for it. This cost will depend on the style of your home (single family versus townhouse or condo) as well as your square footage.

Property Taxes & Mortgage Interest

Finally, there are several property taxes that you might need to pay during escrow that vary depending on where you live. You will also need to factor in prepaid mortgage interest, which is the amount of interest that is due from the time of closing through the end of that month.

Conclusion

There are several factors that go into determining a buyer’s closing costs. These can vary depending on your sale price, your down payment amount, property taxes, and your lender. Always be prepared to pay between 2%-3% of your purchase price when buying a home in Burbank and Los Angeles County.