The costs associated with purchasing or selling real property, aside from the contracted purchase price. These are the costs and expenses associated with finalizing the purchase and transfer of the property. These expenses typically include title company fees, attorney’s fees, mortgage loan fees, etc. Average closing costs are reportedly between 2% and 5% of the loan amount.
- Example : Nancy entered a real estate contract to purchase a home from Mary for $350,000. Nancy took out a mortgage for $300,000 and she paid $12,000 in costs and expenses at the closing. Mary paid $5,000 at the closing for her expenses.
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