Have you ever wondered what closing costs are? Jacksonville agent Amber Skelton with Edge Realty is breaking down tips, tricks, and best practices when it comes to closing on a home transaction.

Closing costs are charges that both the buyer and seller incur during a real estate transaction. During that transaction you are going to experience cost from the title company. A title company will charge you fees to ensure that you are protected with title insurance and then also to pay out your escrow. In the escrow, often you are going to incur fees such as homeowners insurance, homeowners association fees, and then also pre-payment of tax and other homeowner insurance. 

Some other closing costs that you may see when you’re doing a transaction are an appraisal fee and loan fee. The loan fees are fees that are associated with whatever your lender charges you to originate your loan. The appraisal is often paid upfront, sometimes at closing. The appraisal fee is there to protect you and ensures that the property you are purchasing does appraise at the current value.

Understanding closing costs is essential because closing costs can really add up. Whenever you are getting a home loan with your lender, you will discuss your closing costs. They will often give you an estimate of what your costs are going to be. The lender provides you with that estimate so there are no surprises at closing. 

Whether you’re buying or selling, working with a knowledgeable real estate agent can help you understand what to prepare for and plan accordingly. For more information about closing costs, check out our guide to the basics of Arkansas real estate laws and be sure to follow us on Facebook for more tips from your local agents at Edge Realty.