What Are Closing Costs When Buying a Home?
- By Jim Blackburn
- on
- 100 first time home buyer FAQs
First-Time Buyer Guide: Closing Costs Explained in 60 Seconds
���� Thinking about buying your first home but not sure what “closing costs” actually mean? You’re not alone.
Most first-time buyers are surprised by the extra costs that show up right before they get the keys. But here’s the good news: once you understand what closing costs are and how to plan for them, you’ll walk into your closing day with total confidence. Let’s break it down.
1. What Are Closing Costs, Really?
Closing costs are the fees you pay to finalize your home purchase. They include things like lender charges, appraisal fees, credit report checks, escrow services, and title insurance. It’s the behind-the-scenes work that ensures your new home is safe, sound, and legally yours. Think of it as the final mile in your homeownership marathon.
Partner with title and legal professionals through our attorneys and title teams network who ensure every closing cost is legitimate and properly documented.
2. How Much Should You Budget?
You’ll typically pay between 2% and 5% of the purchase price of the home in closing costs.
For example:On a $300,000 home, that’s $6,000 to $15,000.
The exact number depends on the type of loan, your location, and your specific transaction. This is why we always help our clients run the numbers early, so they know what to expect and don’t get blindsided.
See your complete closing cost estimates using the FHA Purchase Loan calculator or Conventional Purchase Loan calculator which show both upfront and monthly costs.
3. Avoid Surprises — Ask for a Cost Estimate Early
The #1 tip for first-time buyers: ask your lender for a detailed breakdown of closing costs up front. At Stairway Mortgage, we walk you through each item so you understand exactly where your money’s going — no guesswork, no hidden fees. The earlier you ask, the better you can budget and the smoother your path to homeownership.
Start with same-day approval to receive detailed cost breakdowns early in your homebuying journey, giving you time to budget properly.
Want to Understand Your Complete Home Purchase Costs?
Closing costs don’t have to be mysterious. Here’s how to plan ahead with confidence:
💰 Calculate total costs with the FHA Purchase Loan calculator or Conventional Purchase Loan calculator
⚡ Get detailed estimates early with same-day approval
🏛️ Work with trusted closing professionals through our attorneys and title teams
📚 Master the complete process at our buy a house page
Ready to Take Your First Step?
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