Question Details

Mark, Home Buyer in Ohio

Why aren't closing costs a flat fee? How is paperwork different on a 500K house compared to a 150K house (other than the wallet behind the?

Asked by Mark, Ohio Tue Jan 4, 2011

purchase)?

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Many of the fees are a flat fee, wire transfers, document prep things like that. But there are certain things, mostly government fees and title insurance that are percentage based.
In Minnesota we have a Mortgage Registration Tax that is a percentage of the mortgage amount, of course they are going to charge you more because of course "it's the fair thing" to do.
As far as title insurance goes, they are insuring costs associated with their being an issue with the title so if the title company ends up having to pay on a 500k mortgage it obviously costs more than 150k mortgage,

Sean Wait
Senior Loan Officer
Spectra Financial Home Mortgage
sean@spectrafinancial.com
0 votes Thank Flag Link Tue Jan 4, 2011
Mark,

If I understand your question correctly.....

One of the major expenses associated with any closing is the cost of the title insurance. This expense is based on the cost of the home.

Bill
0 votes Thank Flag Link Tue Jan 4, 2011
If they were, Mark, they'd price them based on a $1.5M house.
0 votes Thank Flag Link Tue Jan 4, 2011
Taxes vary and so does insurance. Surveys can often change if the lot size changes and who knows how many FedEx shipments, if any, will be needed. Title fees vary as do attorney fees. Obviously recording fees vary with price.
0 votes Thank Flag Link Tue Jan 4, 2011
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