Buyer Closing Costs in Wisconsin
Non-Recurring Closing Costs Associated with the Lender
1. Appraisal fee: The property being appraised is collateral for your mortgage (you’re borrowing money against the value of the Southeastern Wisconsin property you’re borrowing money to buy) so the lender will want to verify that the property’s value is comparable to similar property based on recent sales in your area.
2. Credit Report
3. Flood certification fee: The certification verifies whether your property is in a federally designated flood zone.
4. Flood monitoring: Monitors remapping of flood zones.
5. Lender’s Inspection fee: for newly constructed property to verify that construction is complete with carpeting and flooring installed.
6. Loan discount: AKA points, each point equal to 1 percent of the loan amount.
7. Loan origination fee
8. Mortgage broker fee
9. Tax service fee: For monitoring your payment of property tax.
Other Lender Fees
1. Administration fee
2. Appraisal review fee: Usually done on higher-valued properties.
3. Document preparation
4. Underwriting fee
5. Warehousing fee: The cost of a “warehouse” line of credit.
6. Wire transfer fee: This is the cost to transfer funds from one account to another.
Items required to be paid in advance
1. Homeowner’s insurance: You are usually required to pay the entire first year’s insurance at closing.
2. Mortgage insurance: Some first-time home buyer programs still require the first year’s mortgage insurance to be paid in advance.
3. Pre-paid interest: The interest that accumulates between closing day and the first payment due date.
4. Up front mortgage insurance premium
5. VA funding fee: This is paid to the Veterans Administration for guaranteeing your loan. This may be rolled into the mortgage, instead of being paid up front.
Reserves Deposited with Lender (Escrow Account)
If you have less than a 20 percent down payment, your lender may require that you have an escrow account for taxes and insurance.
1. Homeowners insurance: You will need to deposit two months’ worth of premiums into the escrow account to start it up.
2. Mortgage insurance: Usually two months’ worth of premiums go into the escrow account.
3. Property tax: You will need to deposit two months of taxes into the escrow account.
Non-recurring Settlement Fees
1. Closing/escrow/settlement fee
2. Courier fee: This is the charge for sending documents back and forth between lender and borrower.
3. Home inspection: This is an optional, but recommended, cost.
4. Home warranty
5. Homeowner’s association transfer fee: This only applies if the property you are purchasing has a homeowner's association (or condominium association).
6. Loan tie-in fee: Usually charged by the closing agent, this is for services they provide in dealing with the lender.
7. Notary fees
8. Pest inspection : This may be required, depending on the type of mortgage you'll be obtaining.
9. Recording fees: To record documents with county recorder.
10. Sub-escrow fee: The title insurance company charges this for dealing with the closing agent.
11. Title insurance: You pay this to make sure you have clear title to the property. You pay for the lender's policy of title insurance, and the seller pays for the owner's policy of title insurance.
For more tips on buying a home in Southeast Wisconsin, contact Jennifer Reiger at 414.588.0980.