By Keith Kyle

Closing Costs – Who Generally Pays What In The Escrow Process

Keep in mind that the charts below are based on the standard allocation of costs in an escrow in Three Sixty.  As with any detail of buying a home everything is negotiable including who pays what costs during the transaction.  In addition not all of these costs exist in every transaction and many are dependent on the lender, escrow company and the details of the offer.

Although not in the charts below it is standard for the seller to pay the real estate commission (generally 5% in our area) for both the listing (seller’s) agent and the buyer’s agent.

Title Fees

Name of cost	Customarily Charged By/ Who Pays	What is it?
Owner’s Title Policy	Title company /  Seller cost	Fee for the title policy. Calculated using the sales price.  Insures that the title is clean at close of escrow
Lender’s Title Policy	Title company / Buyer cost	Title policy issued to lender to cover the amount of the loan. Based on the loan amount.
Sub Escrow Fee	Title company / Buyer & Seller	Fee to administer the payoff of loans or property taxes of the seller and collection of funds from the new lender
Document Transfer Tax	LA County / Seller.  There is also a city transfer tax in some cities but not in Hawthorne	Fee charged on all properties that transfer title  based on sales price.  $1.10 per thousand of sales price
Record Release/Reconveyance	LA County / Seller	Charge to record the release/reconveyance
Federal Express/Messanger Fees	Federal Express / Buyer & Seller	Charge to deliver all time sensitive documents and monies
Title/Wire Fee	Banking Instituion / Buyer & Seller	Charge to wire funds to  or from escrow, seller, lenders, etc
Electronic Recording	County / to Buyer	Charge to electronically record the document
Record Grant Deed	County / To Buyer	Charge to record the grant deed
Record Trust Deed	County / To Buyer	Charge to record the trust deed.
Messenger	Messenger Service /Buyer and Seller	Charge to special messenger documents during the escrow:
Lender’s Endorsement	Title / Buyer	Charge for endorsements required by lender to cover “outside  normal” risk circumstances

Escrow Company Fees

Name of Cost	Customarily Charged By/To:	What it is?
Escrow company fee	Escrow / Both buyer and seller each pays own	Covers liability assumed as well as standard processing costs.  This varies but usually cost is somethung in the vicinity of $2.00 per thousand and a $200.00 base
Demand Fee	Escrow / Seller	Charge to request a statement & process involved in getting a payoff figureto escrow on the outstanding amount of the current loan. One demand fee per loan.
Process HOA Docs & Transfer Fee	Escrow / Seller	Fee for processing required to assign membership for HOA a& copying all governing documents
Document Fee	Escrow / Buyer	Covers the cost of all processing required to meet new lender requirements
Loan Tie-In Fee	Escrow / Buyer	Covers the cost of all processing required to meet new lender requirements
Federal Express	Federal Express /Buyer	For document packages to out of County Lenders.

Lender & Loan Costs

Name of Cost	Customarily Charged By/ To	What is it?
Origination Fee	Lender / Buyer	Charge for lending money at 1% of the loan amount
Documentation Preparation	Lender / Buyer	Paid to lender for preparation of final loan documents
Tax service	Tax Service / Buyer	Fee charged to buyer to set up property taxes with the state
Wire	Banking institution	Charge for the wiring of funds to title for closing
Underwriting	Lender / Buyer	Fee to direct lender for the process of approving
Tax impounds	Lender / Buyer	Collected to create an impound reserved account for the lender to pay property taxes twice a year
Prepaid Insurance	Lender / Buyer	Generally 1yr of hazard insurance collected for impound reserveaccount
Appraisal	Appraiser / Buyer	Paid directly to appraiser for appraisal of property
Credit Report	Lender: / Buyer	Paid to credit bureau for report containing 3 credit scores
Processing	Lender / Buyer	Paid to mortgage broker for processing loan package from application to closing

Disbursements

Name of Cost	Customarily Charged By / To	What is it?
HOA Transfer Fee	HOA Management / Seller but often negotiated	HOA or managemebt company fee to transfer ownership and handle new accounting set up
HOA Dues	HOA Management / Seller	Usually prorated and paid through day of closing
Fire Insurance	Insurance Agency / Buyer	1 year prepaid premium for homeowners insurance
Notary	Notary / Buyer

Payoffs

Name of Cost	Customarily Charged By/ To	What is it?
Recording Fee	Existing Lender / Borrower	Charge for having reconveyance recorded by the county.
Statement forwarding fee	Existing Lender / Borrower	Charge for issuing a payoff statement

Credits and Prorations

Name of Cost	Customarily Charged By/ To	What is is?
HOA Dues	Seller  /Buyer	Calculated from date of COA through month-end
County Property Taxes	Seller / Buyer	Calculated from the date of payoff through end of period paid for.