Transfer of funds to cover your closing costs will probably have to be either as a cashier's check or by wire transfer to the title company. The title company will set out the amount to close in the settlement statement, which depending on circumstances may include any of the following:
Down payment.
Loan origination fees.
Points, or loan discount fees.
Appraisal fee.
Credit report fee.
Private mortgage insurance premium.
Escrow for homeowners insurance.
Property tax escrow.
Deed recording fees.
Title insurance policy premiums.
Survey.
Inspection fees for a home inspection.
Notary fees.
Prorations for property taxes, rents, etc.
Most of these costs are specific to financed purchases, so if you are buying for cash, please refer to the page on general closing costs.
Prorations
Because such costs are usually paid on either a monthly or yearly basis, you might have to pay a bill for services used by the sellers before the closing date. Proration is a way for the sellers to pay you bac,k or for you to pay them for bills they may have paid in advance.
Mortgage Escrow
If you are financing your purchase, the lender may keep funds for your property taxes and insurance in an escrow account, collecting them with the mortgage. Then they pay the insurance or taxes for you. You may be required to pay several months of these payments in advance at closing.
