This is a standard within the industry, closing costs on a purchase transaction cost more than a refinance transaction. One reason is because there is an additional form of title insurance when buying a house that’s not required on refinance transaction. When you buy a house, there’s two forms of title insurance required when taking out mortgage loan financing.
Two forms of title insurance:
- Owners policy: which make sure that you’re not buying the house with what’s called a cloud on title wherein an additional lien or another party’s interest prevents the transfer of the property from the seller to you.
- Lenders policy: protects the lender against future possible litigation against another party claiming interest in the house you are purchasing.
If you would like to get a better picture of what your closing costs will be on your potential home purchase, visit our rate quote page for complementary no obligation figures, we can run the math for you!
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