For homebuyers1 min read
Closing costs, explained
What the fees at closing pay for, where your official estimate comes from, and the ways they can be covered.
What they cover
Closing costs are the fees to set up your loan and transfer the home. They fall into a few buckets: lender fees for originating the loan, third-party services like the appraisal, title, and recording, and prepaid items that fund your escrow account, such as the first year of homeowners insurance and a few months of property taxes.
Where your real number comes from
You don't have to guess at the total. Early in the process your loan officer gives you a Loan Estimate, a standardized form that lays out every cost line by line. That's the document to read, not a rule of thumb.
Who can pay them
Closing costs don't always come entirely out of your pocket. Depending on the program, a seller can contribute, gift funds may be allowed, and some costs can be built into the loan. Ask your loan officer which of these fit your purchase.
Questions about your own file?
A loan officer licensed in your state can run your actual numbers.
Keep reading
For homebuyers1 min read
Preparing for pre-approval
What a loan officer looks at, the documents worth gathering early, and how pre-approval differs from pre-qualification.
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How your credit affects your loan
What lenders look at beyond the score, how credit shapes your options, and the moves to avoid once you're shopping.
For homebuyers1 min read
How much down payment you need
The 20% figure is a myth for most buyers. Here's what the low-down-payment programs allow and the trade-offs to weigh.
This guide is general information, not financial advice, a quote, or loan terms. Program availability and qualification vary. ALCOVA Mortgage LLC, NMLS #40508 (www.nmlsconsumeraccess.org). Equal Housing Lender.