Overview of Closing Costs
When you secure a conventional mortgage, the lender and the state require a series of fees that are paid at closing. These costs cover everything from evaluating the property’s value to protecting the buyer and lender against title defects.
Typical Cost Categories
- Loan‑origination fee: Usually 0.5 %–1 % of the loan amount. Lenders charge this to cover the work of processing, underwriting, and preparing the loan documents.
- Appraisal fee: A flat fee paid to a licensed appraiser who determines the market value of the home. The fee ensures the lender is not financing more than the property is worth.
- Credit report fee: A small charge for pulling the borrower’s credit history, which the lender uses to assess risk.
- Title search and title insurance: The search confirms who legally owns the property and whether any liens exist. Title insurance protects the buyer and lender from undiscovered defects. In New Hampshire, the combined cost is commonly $500–$1,500.
- Recording and filing fees: Charged by the county to officially record the deed and mortgage. These fees fund the public record system.
- Attorney fees: New Hampshire traditionally uses attorneys to conduct the closing. Their fee covers legal review of documents and ensures the transaction complies with state law.
- Escrow or settlement agent fee: If a title company handles the closing, this fee covers coordination of document signing and fund disbursement.
New Hampshire‑Specific Factors
New Hampshire does not impose a state income tax, which means there is no separate state income‑tax filing related to the mortgage. However, the state relies heavily on property taxes, so buyers should budget for higher annual property‑tax bills.
The state’s customary use of attorneys rather than title‑company closings can add an attorney‑fee line item, but it also provides a layer of legal protection that many buyers find valuable.
First‑time homebuyers may qualify for assistance through the New Hampshire Housing Finance Authority, which offers down‑payment assistance and reduced‑interest loan programs. Participation does not eliminate closing costs but can offset them.
How Costs Are Paid
- Most fees are paid at the closing table via cash, a certified check, or a wire transfer.
- Some lenders allow borrowers to roll certain fees into the loan amount, increasing the principal balance.
- Seller concessions negotiated during the purchase agreement can cover a portion of the buyer’s closing costs, subject to lender limits (often up to 3 % of the loan).
Reducing Your Closing Costs
- Shop around for appraisal and title‑insurance providers; rates can vary.
- Ask the lender for a detailed Loan Estimate early in the process to compare origination fees.
- Negotiate with the seller for credits toward closing costs.
- Explore state or local first‑time‑buyer programs that may subsidize certain fees.
This article provides general information about conventional loan closing costs in New Hampshire and is not personalized financial or legal advice. Consult a qualified professional for advice tailored to your situation.