Costs buyers usually pay
Most buyer costs come from the loan and from protecting the purchase.
- Lender fees, such as origination and credit report fees
- The appraisal and lender's title insurance
- Prepaid items, like prepaid interest and the first year's homeowners insurance
- Escrow deposits for future property taxes and insurance
- In some areas, recording taxes on the deed and loan
Costs sellers usually pay
Sellers usually pay listing and agent fees, the payoff of their own mortgage, and any liens on the home. Some transfer taxes and prorated property taxes up to the closing date are often the seller's too.
Customs vary by state and even by county, so the split in your area may look different. Your agent can tell you what's typical where you're buying.
Transfer and recording taxes
Transfer and recording taxes are charged by state or local governments when a home changes hands or a mortgage is recorded. Depending on where you live, the buyer may pay, the seller may pay, or the two may split them.
Local custom often sets the starting point, but the contract decides. Ask your agent and settlement agent how it works in your area.
How seller concessions work
A seller concession is money the seller agrees to put toward your closing costs. It can help you keep more cash for your down payment or reserves.
Concessions can only cover actual costs. They can't be paid to you as cash, and if a request is larger than your costs, the extra usually goes unused.
Concession limits by loan type
Loan programs cap how much a seller can contribute, and the cap often depends on your down payment. As a general guide, limits often run from 3% to 9% of the price on conventional loans, 6% on FHA loans and 4% on VA loans, with some costs treated differently. Program rules change, so confirm with your loan consultant.
How ZERO Closing Costs fits in
With CapCenter's ZERO Closing Costs (restrictions apply), CapCenter pays or waives lender fees and many third-party costs, such as the appraisal when required, title insurance and settlement agent fees.
It doesn't cover everything. Escrow deposits, prepaid interest, your first year's homeowners insurance on a purchase, upfront mortgage insurance or VA funding fees, inspections and government recording taxes still apply. A loan consultant can show you what's left.
