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Many home buyers, especially first-time purchasers, are aware of the cost to close on a property -- but these terms and costs are important for both the first time and the repeat buyer.

First-time buyers probably have the toughest time with closing costs partially because they don't know what to expect. Closing costs can add up and, therefore, prospective home buyers need to plan ahead so they don't get caught with fees they hadn't planned for.

Some of the closing costs that prospective home buyers should be aware of:

Appraisal -- an expert judgment or estimate of the quality or value of real estate as of a given date.

Attorney's Fee -- the cost to receive legal counsel in order to complete the home-buying transaction.

Credit Report -- a statement of the borrower's credit history and ability to pay a bank loan. The cost is usually less than $75.

Discount Points -- set on a range of zero to four points, discount points reflect the difference between the loan's face value and it's current cash value. Each point is one percent of the loan.

Escrow -- money or other valuables left in trust with a third party until the fulfillment of a specific act or condition.

Homeowners Insurance -- the cost of insuring a home is usually paid one year in advance.

Interest Per Diem -- This reflects the pro-rated interest or mortgage payment which starts with the date of closing and runs until the first mortgage payment.

Mortgage Insurance -- protects the lender if the buyer defaults on mortgage payments. The premium for mortgage insurance varies with the type of mortgage.

Origination Fees -- this fee covers the lender's cost for processing a loan. The cost is usually one percent of the total loan.

Recording Fee -- the fee paid for making the real estate transaction a matter of public record.

Transfer Tax -- the fee paid to a city for transferring ownership property.

Title Insurance -- protects the home buyer from any loses that may be incurred as the result of a defect in the title.

Fees for these various documents, transactions and legal assistance will vary upon the community, the property and other variables.

A good attorney will be able to assist homeowners in deciphering the route to purchase a home.

Lynn Waddell-Pieri is relocation director for H. Potter Realtors Inc. which has 12 offices and over 450 sales associates and has served the area for 27 years.

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