How to Save on Closing Costs
Buying a home is likely the most expensive purchase you’ll ever make. From the downpayment to moving costs and insurance, the entire process is likely to take a large bite out of your bank account. One place it’s possible to save is on closing costs.
Closing, or settlement, costs are expenses over and above the price of the property. Both the buyer and seller incur some of these expenses when transferring ownership of a property.
So how can you save on these costs? Below are a few tips.
- Haggle with the seller. He or she may pay all or part of the closing costs.
- Nab a no-point loan. You may have to pay a higher interest rate, but if you are strapped for cash and can qualify for a higher interest rate, you may find this type of loan can significantly reduce your closing costs.
- Grab a no-fee loan. Although the fee is usually wrapped into a higher rate loan, it does offer one advantage – you get to save on the amount of cash you would need up-front.
- Secure seller financing. These loans typically avoid the traditional fees or charges imposed by lenders.
- Shop ’til you drop for the best deal. Every lender has its own unique fee structure; you are bound to find one that works for you.