Housing markets with the most expensive homes don’t always have the highest closing costs due to differences in local tax policy, but there may be some correlation. The national average mortgage closing cost is $ 4,876, but some state-level or local-level tracked per-loan totals can exceed five digits.
Expenses like title, appraisal, registration fees, inspection services, surveys and in some cases transfer taxes can really add up in some areas.
“For example, five New York counties – Kings, Queens, Bronx, Richmond, and Suffolk – had the highest closing costs, well above the national and state average, due to some of the taxes. highest transfer rates in the country, ”ClosingCorp said. CEO Bob Jennings said in the provider’s first national snapshot closing costs report.
Even though disclosure regulations implemented in 2015 raised the profile of closing costs and ensured borrowers are better informed during the origination process, they can still surprise first-time homebuyers when consumers start buying loans and find out about the costs, Jennings noted.
“Many homebuyers are still surprised that closing costs are even necessary,” he said.
Here’s a look at the 10 states, plus Washington, DC, with the highest average closing costs. The data, from ClosingCorp, was calculated by running pre-configured loan scenarios against verified data on rates and fees it maintains for service providers and tax authorities. The scenarios are based on live transactions from the second and third quarters of this year.
The different mortgage scenarios are based on the type of loan, the purpose of the loan and the amount of the loan. The company assumed a loan-to-value ratio of 80% and applied the local median selling price to the expense formulas from its data to calculate its expense estimates.
See Also: 10 States With The Lowest Mortgage Closing Costs