Closing Costs Explained (Yes, You Still Have to Pay Them)
Let’s clear up one of the most common homebuying misunderstandings:
Your down payment is not the same thing as your closing costs.
A 0% down loan does not mean you show up to closing with empty pockets and walk away with keys. That’s not how it works. That’s not how any of this works.
Closing costs are the one thing buyers consistently forget to budget for—and they can add up quickly if you’re not prepared. So here’s what they are, what they typically include, and how to plan for them like a grown-up.
What Are Closing Costs?
Closing costs are the fees and expenses you pay to finalize your mortgage. They’re due at (surprise) closing. These are separate from your down payment, and they typically run between 2% to 5% of your home’s purchase price.
Buying a $250,000 home? Expect to bring an extra $5,000 to $12,500 to the table, even if your down payment is zero.
What Closing Costs Include
Here’s a sampling of what you might see on your final paperwork:
Lender fees (application, underwriting, processing)
Appraisal fee
Title insurance and title search
Prepaid taxes and homeowner’s insurance
Escrow account setup
Credit report fee
Recording fees
Survey fee (sometimes)
These aren’t junk fees (usually). These are legitimate costs to get you legally and financially into your new home.
But I Thought My Loan Was 0% Down?
It might be. VA and USDA loans often allow for 0% down. That just means no down payment. You still need to pay closing costs unless your lender or seller is covering them (and that needs to be negotiated up front).
Can I Roll Closing Costs Into My Loan?
Sometimes. Depends on your loan type, the property, and your equity (or lack of it). If that’s something you need to explore, we should talk sooner than later.
Can I Ask the Seller to Pay My Closing Costs?
Yes—it’s called a seller concession, and it’s fairly common. But in a competitive market, asking for too much might weaken your offer.
Final Thought
Don’t let closing costs sneak up on you. They’re not optional, and they’re not small. But they are manageable if you plan ahead.
Want help figuring out your total out-of-pocket costs before you get too deep in the process? Let’s talk. I’ll help you budget for reality—not surprises.
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