Homebuyers are often surprised when they start wrapping up the purchase of a home and realize there are closing costs involved. These aren’t your normal convenience fees. Closing costs can add up to anywhere from 2% to 6% of the total cost of the home. That’s a pretty big expense to have come out of nowhere. Buyers can enjoy a much smoother process if they understand what closing costs are and how they work.
This is where a title company can have a huge impact. Homebuyers and their real estate agents need to work with a title company that provides fast and informative service so that closing costs are straightforward. That way the buyer doesn’t get caught off-guard by expenses they weren’t expecting. Let’s go over some things all buyers, sellers, and real estate agents need to be aware of.
Fees Associated With Closing Costs
Closing costs are made up of many different fees. These include things like home inspection, pest inspection, attorney fees, and credit reports. Closing costs also include fees for the title and municipal lien search the title company performs. This is a lot to keep track of and buyers need to analyze each fee to ensure they’re not paying too much. Title companies can make things easier for themselves and other parties involved by incorporating virtual closing assistants into their system. This resource can act as a hub of communication for the real estate agent and buyer. If they have any questions regarding closing costs, they can go directly to the virtual closing assistant.
How Closing Costs Are Determined
The closing costs on a home depend heavily on the total cost of the property. A title company can provide a closing cost estimate using a virtual closing assistant to free up the Title Closing Agent from manually creating these forms. By entering a few pieces of information, the title company can generate an estimate for the real estate agent and buyer. This is a great resource, as the buyer may want to analyze closing costs to determine if they want to negotiate with the seller for a lower price. Keep in mind that an initial closing cost estimate isn’t set in stone.
Paying for Closing Costs
For the most part, the buyer of the home will pay most of the closing costs. However, there are instances where the seller will handle some of the fees. For example, sometimes the seller pays for the lender’s title insurance. In cases where the buyer wants to use a certain title insurance provider, they’ll likely need to pay the fee. Real estate agents can negotiate on their client’s behalf to try to reduce the closing costs. A title company can also help the buyer reduce the expense by bundling their title and homeowners’ insurance. Using virtual closing assistants will ensure all parties have a strong line of communication with the title company during this process.
Stay on Top of Closing Costs
The closing costs associated with a home can be overwhelming. Title companies can help make the process easier by using a virtual closing assistant throughout the process.
Alanna.ai develops flexible software for the title industry. To learn more, request a demo today.