How do Closing Costs Work?

Certain standard costs are related to closing the sale of a house. Buyers and sellers almost always share these costs, as specified in the sales contract.

As you'll see below, many of the buyer's costs are related to the costs of originating the loan. At AA Mortgage NMLS 1195940, 1707124, we have extensive experience in mortgage lending, so we can provide you with a comprehensive report on costs related to your mortgage in your "Good Faith Estimate".

Good Faith Estimate (GFE)

Buyers will get a "Good Faith Estimate" of closing costs around the time the loan application is submitted to the lender. The closing costs specified in the Good Faith Estimate are estimated based on AA Mortgage NMLS 1195940, 1707124's experience with mortgage loans, but costs often vary a little bit between delivery of the Good Faith Estimate (GFE) and closing. We go over Good Faith Estimates with buyers almost every day, so we'd be glad to answer any questions you have about closing costs.

Below is a fairly generic list of closing costs. We will provide a specific list of your closing costs when we give you a Good Faith Estimate.

Standard Closing Costs

Loan-Related Costs
  • Points — These are costs you pay up-front to lower your mortgage interest rate (optional)
  • Appraisal Fee
  • Credit Report
  • Up-front Interest Payment
  • Escrow Account
  • Taxes
  • Costs associated with "originating" your loan
Property Taxes
  • Insurance
  • Transfer Taxes and Recording Fees
Homeowners Insurance
  • Flood / Earthquake Insurance
  • Private Mortgage Insurance (PMI)
  • Title Insurance

AA Mortgage NMLS 1195940, 1707124 can answer questions about these closing costs. Give us a call at 713-370-LOAN (5626).

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