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Are closing costs higher for new construction than an existing home?

  • October 21 2012 - Severn
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Answers (6)

Mr. King's response is accurate. I sell new construction in Arizona and the closing costs are comparable to resale. Good disclosure on the H.O.A. impound John, Home Owners Associations are not exclusive to new subdivisions and in some rare cases a Resale home within an H.O.A. can cost more at closing due to transfer fees.
  • November 21 2012
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Depends are you talking about a construction loan or end loan for a newly constructed home?
  • October 21 2012
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Thank you all for you quick responses! 
  • October 21 2012
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THE Closing Costs for a New Home and a Resale home should roughly be equal.  There are one or two instances that where you may have an extra charge or two on a new home.  

For example, in some subdivisions, the first owner of a property may have to make an initial contribution to the HOA for common features such as the pool or park.

Other than that, they should be the same as most of your expenses are driven by the amount of your loan and legal fees to transfer the property, etc.
  • October 21 2012
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In So-Cal purchasing new construction offers a lot of builder incentives such as owner financing (low fees) and closing cost credits so you pay nothing (or almost nothing) out of pocket for your closing costs. I would inquire at the sales office about their promotions since they usually have some. If you are working with a Realtor be sure to register that information at the sales office, or have your Realtor do all this work for you so they can be compensated. New home builders have a reputation for being sticklers with this policy at least in my market. Best wishes from So-Cal and good luck
  • October 21 2012
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If all things are equal they should not be higher. I can't think of a closing cost for new that would not be the same for a resale house if the price is the same, the loan the same, the rate to same etc.

Tim
  • October 21 2012
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