Colorado Closing Costs: What to Expect and How to Plan

Closing costs catch a lot of buyers by surprise. Knowing what to expect ahead of time makes the process smoother and helps you compare offers from different lenders.

What closing costs include

Closing costs are the fees and prepaid items due when your loan closes. They generally fall into a few groups:

• Lender fees, such as origination or underwriting fees

• Third-party fees, such as the appraisal and credit report

• Title insurance and settlement or escrow fees

• Government recording fees

• Prepaid items, such as homeowners insurance and an initial deposit for property taxes

How much to budget

The total varies with your purchase price, loan type, location and timing. Your Loan Estimate, which you receive shortly after applying, lists them in detail so there are no surprises.

Who pays what in Colorado

Some costs are customarily paid by the buyer and some by the seller, and much of it is negotiable in your purchase contract. Your real estate agent and I can explain what is typical for your transaction.

Ways to reduce your cash to close

• Ask for seller concessions as part of your offer

• Compare lender fees and pricing on Loan Estimates

• Look into down payment and closing cost assistance programs if you qualify

• Consider the timing of your closing date, which affects some prepaid items

How to compare Loan Estimates

Every lender uses the same standard Loan Estimate form, which makes comparison easier. Look at the rate, the total loan costs in Section D, and the cash to close, rather than any single number. I am happy to review any Loan Estimate with you line by line.

The bottom line

Closing costs are a normal part of buying a home, and planning for them early keeps your purchase on track. If you want a personalized estimate based on your price range, reach out and I will put one together.

This article is general information, not a commitment to lend. Loan programs and guidelines change, and all loans are subject to credit approval and underwriting. Jason Valant, NMLS #2780983. DNVR Lending, LLC, NMLS #2403751. Equal Housing Opportunity.