Closing Cost

Closing Cost is the amount charged by lenders that cover appraisal fees, title insurance, taxes, and any other fees that happen in a real estate purchase. These closing costs can be different for an investment property than purchasing a personal residence. A lot of the closing costs are typically regarding the mortgage, but other costs may be paid by the seller or buyer and discussed in the sales and purchase agreement. Some parts of the closing costs may be a tax-deductible expense or depreciable depending on how they are treated by the investor accounting wise. Closing costs are typically between 2-5% of the home’s sale price but other important factors to take into consideration when planning are things like location and type of property which can vary depending on those factors.