Avoid Paying Unnecessary Fees by Lowering Your Closing Costs—Here’s How

Dusty Rhodes • May 6, 2024

The hardest part’s over because you’ve found the perfect house. Now you have to go through negotiations to buy the house and determine your closing costs.


Closing costs are expenses in the home-buying process that typically equal 2% to 5% of your loan’s value, which can make them very pricy if you’re buying an expensive property.


Borrowers might be able to reduce closing costs with the right negotiation tactics. Wondering how to lower closing costs? Here are several tips to try before you sign off on your purchase.

What are closing costs?

Closing costs are fees that occur when finalizing a real estate transaction on the sale or purchase of a house. Once the property is transferred into your name, these fees are due. Both homebuyers and sellers pay closing costs, but it varies who pays closing costs and how much they pay.


A home loan amount, a property’s location, and a home buyer’s credit score are some of the factors determining closing costs. Some state laws also require professional services that increase a transaction’s closing costs.


Many closing costs are negotiable among homebuyers, sellers, and mortgage lenders. If you’re buying a property, it’s crucial to research and shop around for home loans before choosing a lender.


Can closing costs be negotiated?

There is some negotiation possible, and the following includes ways to possibly lower your closing costs.


Did you review your loan estimate form?

Before you close on your home, your chosen lender will provide you with a contract covering all the details of the agreement. In it, you’ll find information such as your monthly payment amount and interest rate, as well as the percentage owed for closing costs. Remember that things like a low credit score can contribute to a higher interest rate, so try to have more than the minimum credit score.


In reviewing these numbers, you might find that your closing costs are higher than what you’re willing to pay. Don’t hesitate to shop around at other banks and lenders, which might offer you a better deal, including lower closing costs.


Did you research lender fees?

Double-check the lender fees you have to pay to obtain your loan, as you can sometimes save money here, too. Your lender will charge an origination fee. You probably can’t get out of paying this, but your loan agreement could contain other negotiable fees. There’s no harm in asking your lender about these.


This is an area in which it would help to have other loan possibilities for reference. If your chosen lender tacks on more fees, show them your options and negotiate a lower rate or move on to a new lender.


Do you know what you are paying for?

It’s vital to understand closing costs before you go into negotiations. Of course, you have your responsibilities as the buyer—you must pay the application fee, attorney fees, credit report fees, and more. But you should also know what the seller should cover on their end of the deal.


For example, they should contribute to the closing costs, especially when the market is working in the buyer’s favor. To that end, the seller should also cover the real estate agent commissions.


Can you add the closing costs to your mortgage?

You can lower or avoid paying closing costs upfront by folding them into your mortgage. Some lenders will be open to this option, wherein they pay the closing costs for you upfront and then tack that price into your home loan.


This will save you cash in the short term, but you will end up paying more for your closing costs over time since your loan repayments will come with added interest.


Did you look for financial aid?

First-time homebuyers might be able to get a bit of financial relief when they purchase a property. Many grants can help lower the costs of the home-buying process to encourage more people to get into the real estate market.

For instance, if you choose a Fannie Mae loan to buy one of their foreclosed properties, you might be eligible for closing costs as low as 3%. There are also loan programs for those who have, for example, poor credit history, a low down payment, or veteran status.


Local governments or nonprofit organizations may also provide grants for the home-buying process. These programs mostly favor first-time home buyers, and they help cover your down payment and/or closing costs.


Did you research vendors?


As soon as you get your loan, skip to the part where it describes the vendors who can help you through the closing process. Sometimes the people selected by your bank will charge more than ones you can find yourself.


Do your due diligence to ensure you have the least expensive vendors possible. You can ask your lender for other potential vendors they might not have listed on the loan. This research could save you hundreds of dollars in closing costs.


How to lower closing costs

When figuring out how to lower closing costs, it’s most important to understand where you can save money. Even though each real estate deal is different, there are typical closing costs that homebuyers can expect.


Application fee: Before applying for a mortgage, ask your lender if they charge an application fee. If so, make sure you understand what it covers. Application fees are sometimes negotiable, but you might need leverage in your negotiations. That’s why it’s essential to shop around and know what other lenders charge for an application fee.


Appraisal: In most deals, you’ll need to pay an appraisal company to assess the property’s fair market value. Sometimes though, you won’t have to pay this fee, so be sure to discuss with your lender.


Association dues: If you’re buying a property in a homeowners or condo association, you may have to pay your annual association dues at closing. The buyer and seller can split this cost, and you may owe only a prorated amount of the association’s annual dues if you buy a property partway through the year.


Attorney fees: Some states require lawyers to review a real estate transaction’s closing documents. If so, both the buyer and seller have their own legal representation.


Courier fee: Your lender may use a courier to deliver documents required to close a deal. Doing so can expedite finalizing the transaction, but you may pay for this courier fee as a result.


Credit report fee: Your mortgage lender will run a tri-merge credit report. The reports are your credit scores and history from the three major credit bureaus. Depending on the lender, you may not get charged for this, but you’ll have to ask.


Discount points: These “points” represent money you pay your lender at closing to receive a lower mortgage rate. One discount point equals 1% of your home loan amount in exchange for dropping your interest rate by 25 percent. For example, if you pay your lender $1,000 on a $100,000 mortgage loan, your 4% interest rate drops to 3.75%.


It’s important to have a conversation with your lender about what your options are with these points, especially since points are not required. Using points makes sense on paper but paying more upfront may not work for everyone. For those who don’t plan to live in their home long-term or are likely to refinance, this isn’t the best option.


Escrow deposit and fee: Many lenders require you to have an escrow account for your expected property taxes and homeowner’s insurance premium. Your lender makes your insurance and tax payments for you using the money you deposit into your escrow account.


If you’re required to set up an escrow account, a title company, escrow company, or a lawyer will manage the process. They’ll charge a fee for doing so. Often, home buyers and sellers agree to split this cost. You can ask about these costs upfront to make sure they fit within your budget.


(Pro tip: It’s always a good tip to confirm with your city or county that your taxes have actually been paid!)


Flood hazard determination fee: The U.S. government requires a flood risk assessment for all real estate transactions. A third party handles the evaluation, and they’ll charge you a fee for their service. You’ll have to pay for flood insurance if they determine your property is in a flood zone. Be sure to keep this possible expense in mind when choosing a property.


Homeowner’s insurance: Homeowner’s insurance is usually not required by law, yet most lenders require it. It is a good idea to have it in case of damage to the property, and you’ll usually pay your first year’s insurance premium at closing.


Mortgage broker fee: You can hire a mortgage broker to help you find mortgage loans. If you do, they’ll charge you a commission based on the percentage of your loan amount. This is usually between 0.5% and 2.75% of the property’s purchase price. To save money, you could look for loans yourself.


Origination fee: Most lenders charge a loan origination fee when processing your home loan application, which is usually 1% of your loan amount. Not all lenders charge an origination fee, however, so, again, it’s essential to research different mortgage lenders.

  • Upfront: You pay the entire cost of your PMI at closing.
  • Split: You pay part of your PMI costs upfront, and your lender folds the balance into your monthly mortgage payment.
  • Monthly: You pay nothing on your PMI at closing, and your lender adds your entire PMI balance to your monthly mortgage payment.
  • Lender-paid: Your mortgage lender covers your PMI costs in exchange for raising your interest rate; this method can save you money at closing but cost you more over time.


Recording fees: Local governments require a copy of your title before it will recognize you as the property’s legal owner. Your title company usually handles this transaction, and they’ll charge you a fee for that service. However, that’s not always the case, so be sure to ask.


Title search fee: Before you can purchase a property, someone must verify its ownership. A title company handles this process, ensuring no one else can claim the property after you purchase it. The company charges a fee for this service, and it often comes hand-in-hand with title insurance, which protects the buyer from future claims against the property. This fee varies by location and property; it ranges from $200 to $1,000. You can save money by searching for a title company within your budget.


Overall, to save money, you should compare lenders and their fees to make sure you’re getting the best possible deal. You’ll see these fees on a document called a closing disclosure. These are the different costs to consider when buying a home.



Source: BiggerPockets Blog

Dusty Rhodes Properties is the Best Realtor in Myrtle Beach! We do everything in our power to help you find the home of your dreams. With experience, expertise, and passion, we are the perfect partner for you in Myrtle Beach, South Carolina. We love what we do and it shows. With more than 22 years of experience in the field, we know our industry like the back of our hands. There’s no challenge too big or too small, and we dedicate our utmost energy to every project we take on. We search thousands of the active and new listings from Aynor, Carolina Forest, Conway, Garden City Beach, Longs, Loris, Murrells Inlet, Myrtle Beach, North Myrtle Beach, Pawleys Island, and Surfside Beach real estate listings to find the hottest deals just for you!

Share

How to Move Out After Selling a House

By Dusty Rhodes • October 13, 2025
From the first coat of paint you used to freshen up your house’s trim to the stress of wrangling your way to a deal, you’ve been through a lot in that place. Now you’ve made it to the final hurdle of selling a home: moving out! Don’t worry, this is the easy part… but you want to do it right. Here’s how to get through the last leg of your journey without any bumps along the way. How to move out on time Once the paperwork is signed at closing, the buyers will officially own the house—and you won’t. That means that, technically, if you or your stuff is still there after the close, “the buyer could evict you,” says Joshua Jarvis , founder of Jarvis Team Realty in Duluth, GA. So make sure to have your exit strategy in place! Still, most buyers will understand if you need a bit more time and have a legitimate reason—like if you can’t move until the weekend due to your work schedule. Just be sure to discuss these issues as soon as possible before the close, so your buyers can plan accordingly. Decide what to leave behind To make sure you’re leaving behind everything the buyer wanted—and that you agreed to—double-check the closing documents . There should be an itemized list of what comes with the house . And even if the buyers didn’t formally request them, it’s just good form to leave certain types of things behind. Such as? “Generally speaking, you should leave anything that’s bolted to the wall,” says Jarvis. “Some homeowners want to take their fans and blinds to the next home, but generally if it’s screwed in, it stays.” Also, if you and the buyers agreed to transfer any services—such as alarm monitoring or pest control —be sure to set that up before you go. Leave the buyers a detailed note in the house, or ask your agent to get in touch with theirs to make sure the transfer goes smoothly. If you do inadvertently take an item that the buyers had requested, they have the right to ask for it back—and they could potentially sue you in civil court for the cost of a replacement. So, when in doubt, feel free to check with the buyers before you grab and go. But don’t leave anything else behind Just as important as what you leave behind is what you don’t. Your buyers have a right to move into a home that’s been cleared of furniture and other movable items they didn’t expressly request. “Some folks leave all kinds of unwanted clothes, furniture, paint cans, and other items, thinking they are helping the buyers,” Jarvis says. If you truly think your buyers might love to have your old planting pots or kiddie equipment, go ahead and ask—but please don’t assume they’ll welcome your leftovers. Even if you’re careful, you might forget something—at which point the buyers may contact their agent to get it back to you, but they also have the legal right to just keep or get rid of it. So double-check areas (e.g., the attic, garage, basement, storage shed, kitchen, and bathroom drawers) where people commonly overlook items. Clean up It’s common courtesy to leave the place not only clear of your possessions but also clean. However, that doesn’t mean you have to leave it immaculate. “Generally, you shouldn’t have to pay to have it deep cleaned,” Jarvis says. In most cases, a simple broom-clean will do. That means wiping down the countertops, cleaning out drawers, sweeping or vacuuming all the floors, and giving the bathroom and kitchen appliances a once-over so the new owners aren’t grossed out when they arrive. Are you forgetting anything? Before you close the door for the last time, run through a quick checklist. Did you eyeball every room for stray items? Have you forwarded your mail and turned off the utilities? Is the water running in the jacuzzi? We all get in a bit of a rush even in the best planned moves, but you won’t be able to get back in, so it can’t hurt to do a final run-through before you move out. Once you’re ready, it’s time to leave. You can drop a line to your real estate agent to let them know you’re out, although it’s usually a courtesy more than a necessity. If you’re feeling truly gracious, feel free to leave a note, card, or bottle of bubbly congratulating the people who’ve inherited your former home. Given all the fond memories you’ve built between those walls, wouldn’t it be nice to start the home’s new owners off on the right foot? And buy yourself some Champagne, too. Make it the good stuff—you’ve earned it. 

When Are You Considered a First-Time Homebuyer Again?

By Dusty Rhodes • October 6, 2025
Buying a home is an exciting time, whether this is your first time purchasing a house or you’re a repeat buyer. But if you’ve owned a home before, you may be wondering if you can be a first-time home buyer again. In some cases, yes, you can. In this Redfin article, we’ll go over what qualifications you need to meet and when you can be considered a first-time homebuyer again. Whether you’re buying a home in Atlanta, GA , or a condo in Portland, OR , read on to find out if you’re eligible to be a first-time homebuyer twice. Key takeaways Usually, you’re a first-time homebuyer again if you haven’t owned a home in 3 years. Some special situations may also qualify you as a first-time buyer. Benefits include down payment and closing cost assistance and lower interest rates. When are you considered a first-time homebuyer again? Typically, you’re considered a first-time homebuyer again if you have not owned a primary residence for at least three years. There are several additional reasons you may qualify as a first-time homebuyer again, which we’ll explore below. Some first-time homebuyer programs have different definitions of “first-time homebuyer,” so check with the specific program before proceeding. Qualifications to be considered a first-time homebuyer There are other reasons you may qualify as a first-time homebuyer twice. Let’s take a look at them: You haven’t owned a primary residence for 3 years: This means if you owned a home, but sold it and rented for 3 (or more) years, you can be considered a first-time home buyer again. If you’re buying with another person, only one of you needs to meet the criteria to use most first-time home buyer programs. You’re a single-parent buying on your own: If you’ve never purchased a home by yourself and are a divorced single-parent, you may qualify again. Even if you purchased a home with your former spouse, you likely still meet the criteria. You’re a displaced homemaker/family caregiver: If you are a displaced homemaker who doesn’t or didn’t earn wages from employment and has only owned a home with a former spouse, you’re likely considered a first-time homebuyer. You previously owned a mobile home: If you owned a mobile home or property not affixed to a foundation, then you likely qualify. Your previous home was out of compliance: If your home had building code violations or safety issues that could not be repaired or brought into compliance for less than the home’s value, you’re likely eligible. Benefits of being a first-time homebuyer again There are benefits to being a first-time homebuyer twice. Let’s take a look at them: Access to first-time homebuyer programs: One of the biggest benefits is the ability to use first-time homebuyer programs such as down payment and closing cost assistance , grants, credits, or loans. Every program has different qualifications, so make sure to research each program or speak with your agent and lender to explore options. Options for low down payment mortgages: There are several loans available for first-time buyers that offer lower down payment amounts. For example, Freddie Mac’s Home Possible and Fannie Mae’s Home Ready offer down payment amounts as low as 3%. Potentially lower mortgage rates: Sometimes, lenders will offer slightly lower mortgage rates to first-time borrowers to help them buy their first home. FAQs about first-time homebuyers Can I be a first-time homebuyer again if I previously owned a home? Yes, as long as you haven’t owned a primary residence in the last 3 years, or you owned a home while previously married. Do both homebuyers need to be first-time homebuyers to qualify? No, in most cases, as long as one homebuyer meets the qualifying criteria, then you’re considered a first-time homebuyer. However, some programs require both homebuyers to be first-timers. Can I qualify for a first-time homebuyer loan again? Yes, for the most part, if you qualify as a “first-time homebuyer,” you can get another first-time homebuyer loan. Every lender and loan is different, so be sure to read the eligibility criteria thoroughly. Are there income limits for programs? Yes, many first-time homebuyer programs have income limits. This means you won’t qualify if you make more than the specified annual amount.

10 Home Renovation Projects Under $1,000 That Add Lasting Value

By Dusty Rhodes • September 29, 2025
Enhancing your living space doesn’t always require a hefty budget. With the right updates, you can add real value to your home for under $1,000. Whether you’re preparing to sell your home in Grand Rapids, MI , or looking for some easy DIY projects for your house in Portland, OR , these cost-effective upgrades can breathe new life into your space. To dig deeper into this topic, we spoke with Kevin Brasler, executive editor at nonprofit Consumers’ Checkbook , a consumer advocacy group that helps homeowners save money and make smart choices. With decades of experience evaluating service providers, Kevin shares insights on how to budget wisely, avoid common renovation mistakes, and know when to hire a professional versus taking the DIY route. 1. Add fresh paint to the walls of your home Painting is one of the most affordable ways to refresh your home. A gallon of quality paint costs $30 to $50, with a full room averaging around $350 . Neutral shades like gray, beige, or white appeal to most buyers, while accent colors such as navy, forest green, or mustard add personality. For a calming vibe, try sage or powder blue. Brasler notes that painting is one of the best DIY-friendly projects homeowners can take on. “Good DIY projects are those that involve mostly labor: painting, basic tile work, installing fixtures that don’t require new wiring or plumbing, landscaping, and most flooring jobs,” he says. 2. Update your cabinet hardware A cabinet hardware update is a subtle yet effective strategy to elevate your home’s functionality and aesthetic appeal. Swapping outdated or generic cabinet handles and knobs for modern, stylish alternatives instantly transforms kitchens and bathrooms. Consider sleek brushed nickel handles for a contemporary touch, or opt for vintage-inspired brass knobs for a timeless charm. This modest investment typically costs between $2 to $10 per piece. 3. Change the kitchen backsplash A new backsplash can quickly refresh your kitchen while protecting your walls. A custom kitchen backsplash protects your walls from daily wear and creates a focal point that elevates the entire room. Opt for affordable ceramic or glass tiles, which can be found for as low as $1 to $5 per square foot. Staying within a $1,000 budget for a standard-sized kitchen is doable with those materials. Or you can go for a peel-and-stick backsplash that is not only budget-friendly, but a quick solution to make your kitchen stand out. Brasler stresses that getting multiple estimates is critical for even small-scale projects like this. “The biggest mistake homeowners make is not getting multiple bids. Even for smaller projects, you should get at least three written estimates; five is better,” he explains. 4. Switch to energy-efficient lighting By making the switch to energy-efficient lighting, you’ll not only improve the sustainability of your home but also create a more comfortable and inviting living environment. Switching to LED bulbs, which typically cost between $2 to $10 each, saves energy and reduces utility bills over time. Beyond the financial benefits, the crisp and vibrant illumination of energy-efficient lighting can effortlessly enhance your home’s overall mood and appeal. 5. Create a beautiful landscape A simple landscaping update is another low-cost project that adds value. Try planting vibrant flowers, shrubs, and trees, which can cost anywhere from $100 to $500, depending on the size and variety. Add mulch or decorative stones to create a polished look for approximately $50 to $150, while adding affordable outdoor lighting options typically range from $50 to $200. Low-maintenance features lower costs down while still making a strong impression. For most landscaping updates, DIY is both practical and cost-effective. Still, Brasler advises calling in professionals for anything involving gas, high-voltage electrical, or structural work. 6. Install a smart thermostat A smart thermostat, such as popular models like Nest or Ecobee, typically costs between $150 to $300, depending on the brand and features. Homeowners can often handle the installation themselves, avoiding additional labor costs. Once installed, these intelligent devices learn your preferences, allowing for automated temperature adjustments, and can be controlled remotely via smartphone apps. 7. Refurbish or paint the front door Refresh your curb appeal by refurbishing or painting the front door – a low-cost project with instant impact. Sanding and restaining often costs under $100 and requires just a few materials. Another choice is to use high-quality exterior paint, which typically ranges from $30 to $50 per gallon, providing a fresh, vibrant color that suits your home’s style. 8. Add floating shelves or built-ins Consider adding floating shelves or built-in storage solutions to maximize space and keep your home organized. Floating shelves, available for as little as $20 to $50 per shelf, provide an affordable and stylish way to showcase decor or organize essentials. For a more customized approach, DIY built-ins can be crafted using plywood or ready-to-assemble shelving units, typically ranging from $100 to $300. 9. Upgrade your kitchen sink and faucet Breathe new life into your kitchen with a sink and faucet upgrade. Faucets usually run $100 to $300, and sinks $200 to $500. Consider a sleek pull-down faucet and a resilient stainless steel or granite composite sink to improve both function and style. Spending $300 to $800 on a sink and faucet upgrade can instantly refresh your kitchen’s look and make daily tasks easier. 10. Add safety measures to protect your home Smart security cameras or a basic surveillance system now offer affordable and effective protection. Investing in a home surveillance system, typically from $200 to $500, allows real-time monitoring and deterrence against potential threats. The addition of smart cameras, with features like motion detection and remote access via smartphone apps, can improve your home’s overall safety and convenience. With a budget-conscious investment of $500 to $1,000, you can create a comprehensive security network covering critical areas of your property. Tips for finding good contractors Even for smaller projects, working with contractors requires careful planning. Brasler emphasizes the value of comparison shopping. “Get proposals and detailed pricing from at least three reputable, licensed contractors,” he advises. “The only way to ensure you’re paying a fair price is to initiate competition.” He also suggests: Check references thoroughly. Ask questions like: Did the company follow plans? Did it finish on time? Was the work professional? Did the contractor offer low-cost solutions and stick to agreed prices? Were problems handled promptly and effectively? Did the team communicate clearly throughout the project? Was disruption to your daily life kept to a minimum? Did the finished results meet your expectations for quality and appearance? Was the contractor flexible and fair about changes if you adjusted plans? Ask neighbors and friends for referrals. Word-of-mouth often uncovers the best local contractors. Look for complaints. Check ratings at Checkbook.org or your local Better Business Bureau and be cautious with online reviews as they can’t always be trusted. Common mistakes when budgeting for small renovations Brasler states the biggest budgeting mistake is skipping multiple bids. “A contractor charging $800 might be using premium materials while the $500 bid uses builder-grade stuff. Try to get prices from each business for the exact same work,” he explains. He also reminds homeowners not to assume that a low price means low quality. “For decades we have evaluated all kinds of businesses and often find some of the best companies have the lowest prices,” he says. When to DIY vs. hire a pro While DIY saves money, Brasler stresses knowing your limits. “Call in pros to deal with anything involving gas, high-voltage electrical, or structural changes. Ditto for work that requires a permit and inspection,” he advises. For tasks like painting, basic landscaping, or adding shelves, homeowners can usually manage on their own. Keep expectations realistic since DIY projects often take longer and may not match professional results. The bottom line Budget-friendly renovations under $1,000 can make a big difference in your home’s look, comfort, and value. From painting and landscaping to updating fixtures and adding smart technology, these projects prove you don’t need to overspend to refresh your space. As Brasler reminds homeowners, “the key is balancing creativity with caution.” By comparing bids, avoiding common budgeting mistakes, and knowing when to call in the pros, you can achieve lasting results without stretching your wallet.