Closing Costs When Buying or Refinancing a Home
Refinancing Associated Costs
- Interest
- When you close the transaction on your refinance, there will most likely be some outstanding interest due on the old loan. For example, if you close on August twentieth (and you made your last payment), you will have twenty days interest due on the old loan and ten days prepaid interest on the new loan. Your first payment on the new loan would not be until October 1st since you have already paid all of August's interest when you closed the refinance transaction (since interest is paid in arrears, a September payment would have paid August's interest, which has already been paid in closing).
- Reconveyance Fee
- This fee is charged by your existing lender when they "reconvey" their collateral interest in your property back to you through recording of a Reconveyance. This fee can vary from $75 to $125.
- Notary Fees
- Most sets of loan documents have two or three forms that must be notarized. Usually your settlement or escrow agent will arrange for you to sign these forms at their office and charge a notary fee in the neighborhood of $40.
- Demand Fee
- Your existing lender may charge a fee for calculating payoff figures. If they do, this fee may run in the neighborhood of $60.
copyright 2000 by Terry Light and RealEstate ABC, modified 2002
