BUYER Closing Costs in San Diego
There are costs associated with purchasing a house or condo in San Diego, beyond the actual purchase price of the home. Closing costs vary from city to city, but this will be a breakdown of what to expect in America's Finest City. Your lender will be able to give you a very accurate estimate of your closing costs, so ask them for a loan proposal for a property you are considering writing an offer on.
1. Home Inspection
In San Diego, you should expect to pay between $250-$500 for your home inspection, depending on the size of the home. This is money WELL SPENT, as the home inspection gives you great insight into the condition of the home and also lets you know what you may want to put on your Request for Repairs. A thorough home inspection can save you many thousands of dollars in repair work down the line. Though it is not a typical "closing cost," I am including it in this category because it is a buyer-paid expense that must be paid during Escrow.
2. Lender Fees
Unless you are paying cash, you'll have a few fees associated with your mortgage. These include loan origination charges, appraisal, and credit report fees. San Diego origination charges are usually between $1,000-$3,000, appraisals cost around $650, your credit report is under $30. The origination charge helps pay your mortgage lender. The appraisal is very important and is required by lenders--they want to make sure they are not helping you purchase a property for more money than it is worth!
3. Escrow/Title Fees
In California, closings are done by Escrow companies rather than attorneys. Escrow's job is to execute all of the instructions laid out in the purchase contract. Your Escrow fee is normally about .5% of the purchase price. You'll have to pay for the lender's Title Insurance policy (again, about .5% of the purchase price), courier fees ($100) and a recording fee ($129 or so).
4. Pre-Paid Insurance
Lenders will want you to pre-pay 1 year of home insurance premiums. The cost associated with this depends on the purchase price of the home.
Overall, you should expect to pay 2-3% of the purchase price of your home in closing costs. Your lender can help you get a really clear estimate of what you'll be required to pay before closing!