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Closing Cost

SECTION. 10-3. pp. 349-350. Closing Cost. Key Words to Know. closing costs (p. 349) The costs of transferring ownership of property, such as credit checks and title searches, to the buyer by the seller. Formula. Closing Costs = Sum of Bank Fees. Example 1.

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Closing Cost

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  1. SECTION 10-3 pp. 349-350 Closing Cost

  2. Key Words to Know closing costs (p. 349) The costs of transferring ownership of property, such as credit checks and title searches, to the buyer by the seller.

  3. Formula Closing Costs = Sum of Bank Fees

  4. Example 1 Hay Lee and Donny Sosa have been granted a mortgage loan at an annual interest rate of 8 percent for 25 years by State Bank. The home has a selling price of $95,500. They need a 15 percent down payment. State Bank will allow them to finance the closing costs as part of the mortgage. What are the total closing costs? What is actual amount financed with the mortgage?

  5. Example 1 Answer: Step 1 Find the down payment. $95,500 × 15% = $14,325

  6. Example 1 Answer: Step 2 Find the amount of the mortgage. $95,500 – $14,325 = $81,175

  7. Example 1 Answer: Step 3 Find the closing costs.

  8. Example 1 Answer: Step 4 Find the actual amount financed. Amount of Mortgage + Closing Costs $81,175 + $3,194.96 = $84,369.96

  9. 350:1-17

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