Closing Costs Explained: A Resource For First-Time Buyers

Posted by Lauren Spencer on Thursday, November 5th, 2015 at 2:06pm.


What Are closing costs in Santa Cruz?So, you’ve found the perfect homes for sale in Santa Cruz and have already been approved for a mortgage. All that’s left is for you to finalize the deal and the home is yours! Sounds pretty straight forward, right? But closing costs have a tendency to sneak up on buyers (especially first-timers) that get so caught up in the excitement of house shopping that they completely forget about them, that is until they want to seal the deal. 

What Are Closing Costs?

Whenever you buy a home, there are quite often a number of additional costs to cover the cost of third-party and lender fees. These fees are called the ‘closing costs’, and include all of the costs that are incurred along the way, like lawyers, appraisers, documentation, and so on. Closing costs are little different from home to home, and lender to lender, so we can't actually provide you with a dollar figure. However, you can ask your lender for more information when you inquire about the loan. 

What Types Of Fees Are Included In Closing Costs

There are roughly seven different types of fees you can anticipate to be included in your closing costs.

  • Lender
  • Points
  • Appraisals
  • Credit Fees
  • Insurance Fees
  • Taxes
  • Title & Escrow Fees

For more information about the different types of closing costs and a detailed explanation of each, refer to our past blog post about Santa Cruz Closing Costs.

What Can I Do To Prepare For Closing Costs?

Unfortunately, there’s really no way to get around closing costs, but you can prepare for them. Be sure to ask your lender for a “Good Faith Estimate” when you inquire about a mortgage. Although it’s an estimate, it’ll give you a decent idea of how much you can expect things will cost and help you determine if you can factor that into your mortgage or down payment.

Luckily in Santa Cruz, it's customary to split the closing costs 50/50 between the buyer and the seller, so you won’t necessarily be on the hook for all of the costs. However, if someone is extremely eager to sell they could offer to credit you for all of the closing costs. 

The best way to prevent these kinds of fees from sneaking up on you is to hire a great real estate agent. Honestly, it’s their job to help you find the home of your dreams and support you throughout the journey, from the first consultation until you sign on the dotted line. I’ve spend 29 years helping people in Santa Cruz buy and sell their homes, many of whom have become personal and professional friends along the way. If you’d like more information about closing costs or would like to start searching for your dream home, send me a message online or call me at 831-662-6522.

About Lauren Spencer

Award-Winning Santa Cruz REALTOR®

Lauren Spencer is your local real estate expert, specializing in Santa Cruz real estate and surrounding communities—this is where she lives, works, and plays too. Let her know your questions about the community and county and she'll be happy to fill you in on all you want to know! Lauren Spencer has consistently been voted best local REALTOR in Santa Cruz and is always happy to offer her advice and expertise. Call her at: 800.226.4717.

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