How do Closing Costs Work?

"Closing Costs" are the fees that pay for various services involved in the sale of residential real estate. Buyers & sellers usually negotiate to decide how to split these closing costs.

As indicated below, many of the buyer's closing costs are related to the costs of originating the mortgage loan. Since Power Purchase Mortgage is highly experienced with mortgages and closings, we are closing cost experts.

The Loan Estimate (LE)

Very soon after you submit your application, we'll provide you with the "Loan Estimate" of your costs. We base this cost estimate on our many years of past experience. Please note that while our LEs are very accurate, we cannot always estimate your closing costs to the penny. We will be glad to review the "Loan Estimate," answering your questions and highlighting costs that sometimes change slightly at closing.

We've provided a general list of these costs below, but we will provide you a specific list of closing costs, with amounts, soon after you have completed your application. At Power Purchase Mortgage, we don't believe in surprises, so if your costs change, we'll be sure to let you know immediately.

Standard Closing Costs

Loan-Related Costs
  • Points — lower your mortgage interest rate (optional)
  • Appraisal Fee
  • Getting Your Credit Report
  • Up-front Interest Payment
  • Escrow Account
  • Various Taxes
  • Costs associated with "originating" your loan
Property Taxes
  • Transfer Taxes & Recording Fees
  • Insurance
Homeowners Insurance
  • Flood or Earthquake Insurance
  • Private Mortgage Insurance (PMI)
  • Title Insurance

At Power Purchase Mortgage, we answer questions about closing costs every day. Call us at (800)593-0143.

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