How do Closing Costs Work?

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"Closing Costs" are the fees which pay for various services involved when you refinance or buy a home. On a purchase the sellers & buyers negotiate the payment of these closing costs.

As indicated below, many of the closing costs result from getting your mortgage. Since A Home's Best Mortgage, Inc. is highly experienced with mortgages, we are closing cost experts and therefore you are only charged for those services needed to complete your transaction. We save you more money than most others because we don't charge you a processing fee!

Loan Estimate (Also know as the "LE")

Borrowers will receive a Loan Estimate" of closing costs within three business days once they have submitted their official loan application. We base this estimate on our many years of past experience. It's important to note that while the Loan Estimate is sent to you by the lender our Closing Cost Worksheet contains a more accurate estimate. We will be glad to review the Loan Estimate along with the Closing Cost Worksheet, answering your questions and pointing out costs that can vary a little bit at the closing table.

Below is a fairly generic list of costs for refinancing or buying a home. We will always provide you with a more specific list of your closing costs when your Loan Estimate is provided. 

Standard Closing Costs

Typical Loan-Related Costs
  • Appraisal Cost -- typically range from $0 (appraisal waiver if offered in approval) to $1200.00 for multi unit dwellings. 
  • Credit Report -- Tri-merge report typically ranges from $40.00 for individual to $80.00 for joint applications--credit updates and/or additional applicants will cost more.
  • Lender Fees -- typically range from $0 to $1000.00 depending on program chosen.
  • Points -- Normally used to lower your interest rate and are usually optional unless a lower rate is needed to qualify. 
  • Up-front per diem interest is from the date your loan funds to the end of the month. 
  • Escrow Account for taxes and insurance items (Hazard, Flood, Private Mortgage Insurance (PMI) etc.)
  • FHA Loans charge a one-time upfront HUD premium along with monthly mortgage insurance 
  • VA Loans have a VA Funding Fee which you may be exempt from depending on your Certificate of Eligibility. 
  • Title Insurance determined by title company chosen.
  • Title Closing Fees determined by title company chosen.
  • Transfer Tax as charged by the State of Colorado for a new home purchase.
  • Recording Fees as determined by the title company.
This is a list of typical closing costs we see and is not meant to be inclusive of all fees you may encounter in your particular transaction. You'll notice we have no processing fees!
Here at A Home's Best Mortgage, Inc., we answer questions about closing costs every day. Give us a call at (303) 650-9400.

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