Guide to Closing Costs for Home Buyers and Sellers in New York State

If you are buying or selling a house or real property in New York State, you will incur closing costs. If you are buying a house and obtaining a mortgage, these can be substantial. Be sure to check with your attorney or bank for a complete list. If you are selling your house, you will incur costs as well. Knowing what these are up front can help you plan your next move and help your transaction go smoothly.

Typical Closing Costs for Home Sellers in New York

1. Real estate commission. This is the amount of money you have agreed to pay your Realtor. It is usually a percentage of the total sale amount of your house and is usually payable only if and when title passes to the new owner.

2. Mortgage principal remaining on the property. You will have to pay your mortgagor the amount remaining on your mortgage. Make sure to have a pay off amount prior to the closing.

3. Seller's fee for his/her attorney. If you are using an attorney to close the sale of your house, you will need to pay his or her fee for services rendered.

4. State's Property Transfer Tax: New York State charges $4 for each $1,000 of the selling price (so if your selling price is $100,000, you will have to pay $400).

Typical Closing Costs for the Buyer in New York

1. Application fee. This fee is charged by all banks and mortgage brokers to process your mortgage application.

2. Appraisal Fee. Your bank will require an appraisal of your intended purchase by a licensed real estate appraiser. The fee will depend on the purchase price.

3. Real Estate Tax Service Fee. This fee is $69 in New York.

4. Mansion Tax. There is a1% tax on the total purchase price exceeding $1,000,000 in New York.

5. Lender Closing Fee. Thesefees cover origination fees not paid at time of loan. They may or may not be referred to as points.

6. Prepaid Interest. Per diem interest must be paid on day you close the loan if closing is not on the first of the month.

7. Property Tax Escrow Advance. Lenders often insist on paying property tax on houses they issue mortgages for to assure taxes get paid. They will escrow money for this at the time of the closing.

8. Attorney's Fee. The buyer will pay the fee charged by his or her attorney for services rendered. There will also be a fee which is paid by the buyer to the bank's attorney.

9. Adjustments. Checks must go to seller for any heating oil left and any property taxes paid in advance.

10. Balance of Purchase Price. This is the difference between the selling price and the amount received from the mortgage, plus the amount the buyer has paid earlier upon agreement to buy house (down payment).

11. Mortgage Tax. New York State's mortgage tax is 1% of the buyer's mortgage amount; the buyer will pay 75% of tax and the lending bank pays 25%.

12. Title Insurance. This is a one-time cost based on the selling price of property; approximately $3.80 per $1,000. It insures that there is no one else who claims to own the house.

13. Mortgage Insurance. Insurance to be paid by the buyer to the bank covering the mortgage in the event the buyer defaults. Bank will not make the loan without this insurance. Cost is $3.17 per $1,000 for mortgage of $100,000-$500,000. Discount given if Title Insurance taken with Mortgage Insurance.

14. Tip for Title Closer. This is optional and your attorney can advise you of customary amounts.

15. Underwriting Fee. All banks charge a one time fee for processing the loan-this fee is $450.

This guide is intended to give home buyers and sellers in New York State an idea of what to expect for their closing costs. It is believed to be accurate, but it is subject to errors and omissions. All entries on this list should be verified. Be sure to check with your Real Estate attorney or qualified professional for good faith estimates before closing.