Understanding Mortgage Closing Costs

title settlement service
title settlement service

When you purchase a home with a mortgage, there are still a number of costs you need to pay up-front. One of these costs is the down payment on the loan. The other costs all fall under the umbrella of “closing costs.” These are various fees you pay to the bank, the attorney, your title settlement service, and other individuals and companies involved in the real estate transaction. 

It’s important to be an informed buyer, and part of being an informed buyer is knowing where various closing costs come from. Here are the typical closing costs you’ll pay when buying a home.

Loan Application Fee

This is a fee is paid to the bank to cover the costs associated with you applying for a loan.

Escrow Fee

At closing, you will generally be asked to pay several months’ worth of taxes and mortgage insurance payments into an escrow fund. This is bundled into the escrow fee. The funds will be kept in your escrow fund once the loan closes.

Lender’s Title Insurance Fee

Title insurance protects the lender if any defects in the title arise after closing. The fee for this insurance is paid to a real estate title company.

Owner’s Title Insurance Fee

You have the option of purchasing title insurance to protect you, the new owner of the home, from defects in the title. If you want this insurance, you’ll pay for it during closing.

Credit Report Fee

The bank will need to access your credit report in order to make you a loan offer. The fee for this credit report will be passed on to you.

Private Mortgage Insurance Premium (FHA Insurance Premium)

If your down payment is less than 20% of the home cost, you’ll generally be required to have private mortgage insurance. The first month’s premium is typically due at closing.

HOA Transfer Fee

If your new home is a part of a homeowner’s association, you’ll generally pay an HOA transfer fee to put the home into your name with the association.

Prepaid Daily Interest

Interest will accrue on your mortgage between your closing date and the first mortgage payment. You’ll pay this interest at closing as a fee called “prepaid daily interest.”

Survey and Recording Fee

The survey fee goes to the company that checks and establishes the property’s boundaries. A recording fee goes to the county clerk’s office for the processing of these records.

Title Search Fee

The title search will reveal any liens on the property or other possible discrepancies with the title. The fee for this service is paid to your PA settlement service at closing.

Transfer Fee

Many municipalities charge a transfer fee or transfer tax when ownership of a property changes. Costs vary widely from town to town and county to county.

Now that you understand these closing costs, you can enter the next real estate transaction as an informed buyer. If you’re looking for a “title search company near me” to work with you through the process, contact Heritage Land Transfer. We have a great network of real estate professionals to hold your hand through it. If you need a real estate escrow company, know that we offer escrow services too.

Our guaranteed lowest rates for title insurance, and our customer-centric, efficient title search and closing process helps our client reduce a lot of the stress and risk associated with real estate transactions. Contact us today.

Heritage Cares: We are Dedicated to Giving Back to Our Community

real estate title company
real estate title company

Herman Melville once wrote, “We cannot live only for ourselves. A thousand fibers connect us with our fellow men.” At Heritage Land Transfer, we are motivated by this quote. We think it speaks powerfully to the importance of community. Within a community, we are all connected; our actions impact one another. 

Because we care about our community and about the success of each of its members, we do our very best to give back. It’s simply a part of our culture here at Heritage Land Transfer. We see ourselves not as an island, but as an interwoven part of the communities we live in and serve, and we hope our actions as a PA settlement service reflect that.

Scholarship Program

One of the ways our title insurance agency gives back to the community is through our scholarship program. By awarding scholarship funds to students, we are investing in their future, and thereby the future of our community. Our scholarships have helped make college and higher education possible for numerous young folks. 

A little help at the start of one’s education can make all the difference in that individual’s future. Scholarship funds can help students reach higher, achieve more, and ultimately enjoy greater economic success in adulthood. 

Contributing to the education of others benefits the community as a whole, too. Better education means we all have access to more knowledgeable, experienced professionals. Education equips today’s youth to be the problem-solvers of the future, and we’re happy to encourage that growth through our scholarships. As a trusted Philadelphia real estate title company, we’re proud to do our part.

Volunteer Work

At Heritage Land Transfer, we truly have some of the kindest, most dedicated employees. Not only do they do an excellent job at offering title and escrow services, but they are dedicated volunteers, too.

Each of our employees has the option of spending up to 20 paid hours per year volunteering in the community. We’ve had employees work on community gardening projects, and others who have worked with the underserved.

Through volunteer work, our employees not only help solve problems within the community; they also remain more aware and involved of what’s going on in the community around them. In working with others, they learn more about those peoples’ needs, which enables them to better serve those individuals in their profession and in their personal life.

At Heritage Land Transfer, we are all about the people. Our client-first mentality extends beyond the workplace and into our scholarship and volunteer programs. IN this season of giving, we encourage each and every one of you to also consider what more you can do to give back. Communities are for all of us, and the more we contribute, the better we are for it.

Contact us to learn more about our title insurance and settlement services.