Buyers can usually expect to pay about 5% of their purchase price in closing costs. So, if you are buying a home listed for KSH2,000,000, you can expect to pay KSh100,000 in closing costs. Most buyers pay closing costs as a one-time, out-of-pocket expense when closing their loan.
P R O P E R T Y R E L A T E D C O S T S
Appraisal: This will be mandated by the lender to make sure the home is worth the sales price. Escrow fees: You may have to pay portions of property taxes and insurance upfront into an escrow account
Home inspection: Depends on the square footage and type of inspection.
Property taxes: At closing, the buyer typically pays the city and county property taxes due from the date of closing through the end of the tax year.
Title/attorney fees: This includes necessary government filing fees, escrow fees, notary fees and other expenses related to transferring the deed
Lender fees: These cover items ranging from administrative costs to pulling your credit report to wire transfer fees.
Application fee: This is charged by the lender and varies in price, up to KSh500 or more. The application fee is non-refundable, even if you are not approved for the loan.
Prepaid Interest: This is daily interest that accrues on the loan between the closing date and first monthly mortgage payment
Loan origination fee: These are the fees paid to the lender to obtain a mortgage and are expressed as a percentage of the loan amount. If the loan amount is KSH100,000 and you see a KSH1,000 loan origination fee on the paperwork, the lender is charging one mortgage point.
Discount points: You may pay the lender a fee for bringing down the interest rate. Buying One-point costs 1% of your mortgage amount.
Title search fee: Paid to the title search company that researched the property’s history to make sure the title (ownership) will be “clear.”
For detailed information, please check our mortgage guide on the guides section or contact [email protected] and request for our complete mortgage guide.