What Are the Total Estimated Closing Costs When Buying a Home?

When buyers start planning for a home purchase, most focus on the down payment. But one of the most common surprises for first-time buyers is the additional expense known as closing costs.

If you’re buying a home in Westchester County, understanding these costs ahead of time can help you budget properly and avoid last-minute stress before closing day.

So what exactly are closing costs, and how much should you expect to pay?

What Are Closing Costs?

Closing costs are the collection of fees and expenses required to finalize your home purchase. These costs cover the services, legal work, and financial processing involved in transferring ownership of the property from the seller to the buyer.

For most buyers in New York, closing costs typically range from 2% to 5% of the purchase price of the home.

For example:

• On a $500,000 home, closing costs may range from $10,000 to $25,000

• On a $700,000 home, closing costs could range from $14,000 to $35,000

The exact amount depends on your loan, the property, and the professionals involved in the transaction.

Attorney Fees

In New York, both buyers and sellers typically hire real estate attorneys to handle the legal side of the transaction.

Your attorney will:

• Review the purchase contract

• Conduct due diligence on the property

• Review the title report

• Prepare and review closing documents

• Represent you at closing

Attorney fees in Westchester County typically range from $1,500 to $3,000, depending on the complexity of the transaction.

Title Insurance

Title insurance protects you and your lender from potential ownership disputes, liens, or legal claims against the property.

There are two types of policies typically involved:

• Lender’s title insurance (required if you have a mortgage)

• Owner’s title insurance (optional but strongly recommended)

The cost is usually a one-time fee based on the purchase price of the home.

Lender Fees

If you are financing your home, your lender will charge fees associated with processing and approving your mortgage.

Common lender-related closing costs include:

• Loan origination fee

• Application fee

• Underwriting fee

• Credit report fee

• Appraisal fee

Together, these costs can total several thousand dollars depending on the lender and loan program.

Taxes and Government Fees

Buyers in New York also pay certain taxes and recording fees associated with the transfer of property.

These may include:

• Mortgage recording tax

• Recording fees for the deed and mortgage

• Local filing fees

The mortgage recording tax is a significant cost in many New York transactions and varies based on the loan amount and municipality.

Prepaid Expenses

At closing, buyers also need to prepay certain housing-related expenses. These aren’t technically fees but are collected upfront so your lender can establish your escrow account.

Prepaid items may include:

• Property taxes

• Homeowners insurance

• Mortgage interest from closing until the first payment

• Escrow reserves for taxes and insurance

These costs vary depending on the time of year you close and the tax schedule of the property.

Home Inspection and Other Upfront Costs

While not always included in the final closing statement, buyers should also account for other costs that occur during the transaction, such as:

• Home inspection fees

• Survey fees (if required)

• Additional specialty inspections (radon, termite, etc.)

These costs are typically paid earlier in the process but are still part of the overall financial picture of purchasing a home.

Why Planning Ahead Matters

One of the best things you can do as a buyer is prepare for closing costs early in the process.

Your lender will provide a document called a Loan Estimate, which outlines the projected costs associated with your mortgage and closing. Reviewing this with your agent can help ensure there are no surprises as you move closer to closing day.

Final Thoughts

Closing costs are an essential part of buying a home, and understanding them early can help you feel more confident and prepared throughout the transaction.

An experienced real estate agent will help you anticipate these costs, coordinate with your lender and attorney, and make sure everything stays on track from accepted offer to closing day.

If you're planning to purchase a home in Westchester County and want help understanding the full financial picture, having a knowledgeable professional guiding you through the process can make all the difference.

Give me a call, Jeselle at 646-421-4467 or email me at jeselle.eli@randrealty.com to get started.