Closing Costs Definition & Information

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Closing Costs Definition

Closing Costs

When you buy or sell a home, certain expenses are incurred that are referred to as closing costs. These costs fall into one of two categories. Nonrecurring closing costs are those expenses that are incurred by the buyer in relation to purchasing the property and obtaining the loan. These are one-time costs that won’t need to be paid again. Pre-paid closing costs are items, like property taxes and insurance, that will be paid on a recurring basis. When you buy a home, you should receive a Good Faith Estimate of these closing costs within three days of submitting your loan application to your lender.


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