Inspecting Your Closing Costs: A Detailed Checklist

15 June 2025

Buying a home is an exciting journey, but let’s be real—it also comes with a stack of paperwork and a bunch of extra fees. Among those, closing costs can sometimes feel like a mystery. If you're not careful, you might end up paying more than you should.

So, how can you ensure you're not caught off guard? That’s where a detailed checklist comes in handy! In this guide, we’ll break down everything you need to inspect when reviewing your closing costs.

What Are Closing Costs?

Closing costs are the fees and expenses you pay when finalizing a home purchase. These costs typically range between 2% and 5% of the purchase price. They include lender fees, title insurance, taxes, and other charges that you’ll need to cover before getting the keys to your new home.

Some costs are negotiable, while others are set in stone. The key is to review each fee carefully so you don’t overpay.

Why Should You Inspect Your Closing Costs?

Would you ever buy something without checking the price tag? Probably not. The same principle applies to closing costs.

Lenders and sellers often include various fees, some of which can be unnecessary or inflated. Understanding these costs helps you:

✅ Avoid overpaying
✅ Spot errors or duplicate charges
✅ Negotiate certain fees
✅ Budget accordingly

Now, let’s dive into the detailed checklist to make sure you’ve got everything covered.

Your Closing Costs Checklist

1. Loan-Related Fees

These are fees charged by your mortgage lender. They ensure your loan is processed, underwritten, and finalized.

✔️ Loan Origination Fee

This is what the lender charges to process your mortgage. It typically ranges from 0.5% to 1% of the loan amount. If it seems too high, ask your lender for an explanation.

✔️ Discount Points

Want a lower interest rate? You can pay discount points upfront to reduce your rate over time. Each point usually costs 1% of your loan. Crunch the numbers to see if it's worth it for your situation.

✔️ Underwriting Fee

This fee covers the lender's review of your financial background and creditworthiness. It can range from $400 to $900.

✔️ Credit Report Fee

Lenders pull your credit report to assess your risk level. This fee typically falls between $30 to $50. Some lenders waive this cost, so it's worth asking.

2. Title & Escrow Fees

Your home’s title needs to be reviewed, insured, and transferred legally. Here’s what to check:

✔️ Title Search Fee

Before closing, the title company checks public records to ensure there are no liens or ownership disputes. Expect to pay $200 to $400.

✔️ Title Insurance

This protects both you and your lender from future ownership claims. The lender’s policy is mandatory, while the owner’s policy is optional but highly recommended. Prices vary based on your home’s value.

✔️ Escrow Fees

Your escrow company holds funds and documents until everything is legally finalized. They charge a fee for this service, typically $500 to $2,000, depending on your state.

3. Government & Transfer Fees

These fees go to your local government for processing your home purchase.

✔️ Recording Fees

Your local government office charges a fee to officially record your home’s deed. This can range from $25 to $250.

✔️ Transfer Taxes

Some states and counties charge a transfer tax when a property changes ownership. These fees vary widely, so check your local tax laws.

4. Prepaid Costs

Some closing costs aren’t fees but rather prepaid expenses you’ll need to cover in advance.

✔️ Property Taxes

Lenders require you to prepay property taxes at closing, usually six months’ worth. Check that you’re not overpaying.

✔️ Homeowners Insurance

Most lenders require a full year of homeowners insurance to be paid upfront. Compare quotes to ensure you're getting the best deal.

✔️ Prepaid Interest

This covers mortgage interest from your closing date until the end of the month. If you close early in the month, you’ll pay more interest upfront, so timing your closing can save you money.

5. Optional (but Common) Fees

These fees might appear in your closing costs, but they aren’t always mandatory.

✔️ Home Inspection Fee

A thorough home inspection can cost $300 to $600, but it’s worth it to uncover any potential issues.

✔️ Survey Fee

Some lenders require a land survey to confirm property boundaries. If needed, expect to pay $300 to $900.

✔️ HOA Transfer Fees

If your home is in a neighborhood with a homeowners association (HOA), there may be transfer fees. Fees vary, so check with the HOA.

Pro Tips to Reduce Closing Costs

💡 Negotiate with the Seller – You can request the seller to cover part of your closing costs as part of the purchase agreement.

💡 Shop Around for Services – Title companies, homeowners insurance, and inspectors have varying rates. Compare prices to save money.

💡 Ask About Discounted Fees – Some lenders offer discounts, especially for first-time homebuyers. Always ask!

💡 Close at the End of the Month – This minimizes prepaid interest, saving you cash upfront.

Final Thoughts

Closing costs might seem overwhelming at first, but with the right checklist in hand, you can take control of the process. Scrutinize every fee, challenge any questionable charges, and negotiate wherever possible.

Remember—it’s your hard-earned money. A little extra diligence now can save you hundreds or even thousands of dollars in unnecessary fees. So, before signing on the dotted line, make sure you inspect your closing costs like a pro!