Amounts paid for various services during a real estateclosing, such as document preparation, notary services and title insurance. Closing costs are separate from the purchase price of the property and they can range from 3% to 7% of a home's closing price. See a list of common closing costs
down payment
The part of the purchase price of a property that the buyer pays upfront in cash. (This amount is separate from the loan amount and the closing costs.)
good-faith estimate
An educated estimate of closing costs that a buyer is likely to owe. A lender is required to provide this estimate to the borrower within three days of receiving a home-loanapplication. The final amount due may vary, but should be close to the lenders estimate.
non-recurring closing costs
Closing costs that you pay only once, such as title insurance and transfer taxes.
PITI reserves
A cash amount that a borrower must have on hand after making a down payment and paying all closing costs for the purchase of a home. The principal, interest, taxes, and insurance (PITI) reserves must equal the amount that the borrower would have to pay for a predefined number of months.
recurring closing costs
Costs and fees that will be paid each month or each year, such as mortgage insurance and property taxes.
risk rate
When used with title insurance, a rate that does not include the cost of a title examination or other closing costs.
