“Closing Costs Statistics are Very Misleading”
Are we forgetting about how many transactions were properties sold for cash over the last couple of years? The last I knew real estate values have dropped over the last couple of years, which means that the sales that needed a mortgage, would have meant smaller mortgages.
The article below indicates that closing costs have dropped 7%. If they haven’t figured it out already, it’s because the loans sizes have dropped by about 7%. Even with all of the gyrations with new regulations that were supposed to lower closing cost, it has not been accomplished one bit.
The only thing that these cost cutting measures have accomplished, is employed a boat load of government employees that are supposed to manage all the new regulations and figure out if the consumer is paying less for closing costs. What a joke.
In the meantime the public, all of us, are footing the bill for these guys to have unnecessary jobs.
Closing Costs Decline in 2012
By: Paul Muolo
The average cost to close a residential loan in the U.S. dropped 7% over the past year to $3,754, according to Bankrate.com’s eighth annual closing costs survey.
The firm reported that title insurance and other third-party fees fell 12% from 2011, while origination fees edged down 1%.
Bankrate said it surveyed “up to 10 lenders in all 50 states plus the District of Columbia in June 2012.”
Researchers working for the firm obtained online good faith estimates for a $200,000 mortgage to buy a single-family home with a 20% down payment.
Costs include fees charged by lenders, as well as third-party fees for services such as appraisals and title insurance. The survey excludes taxes, property insurance, association fees, interest and other prepaid items.
“This is the second year in which lenders are required to estimate third-party fees within 10 percent of the final cost. It seems like they’re getting more accurate, which helps explain the sharp decrease in these fees over the past year,” said Greg McBride, CFA, Bankrate.com’s senior financial analyst.
For the third straight year, New York posted the nation’s most expensive closing costs at an average of $5,435. The next most expensive states include: Texas, Pennsylvania, Florida and Oklahoma.
The least expensive state are Missouri ($3,006 on average), followed by Kansas, Colorado, Iowa and Arkansas.
image: salvatore vuon/freedigitalphotos.net.