How Much Are Closing Costs in Utah 2024?

Buying a home is a huge financial decision, and there’s a lot more to consider than just the price of the home. Another substantial cost to consider when you’re buying a new home is closing costs.

Closing costs are the taxes and fees associated with the purchase and sale of a home, such as title insurance and lender fees. To help prepare you for the final steps of the homebuying process, this Redfin article will break down how much closing costs are in Utah, who pays for them, and what costs you can expect to pay as a buyer and as a seller.

How much are closing costs on average in Utah?

Before securing the keys to your new home, homebuyers will need to pay for closing costs. Generally speaking, closing costs in Utah can range anywhere from 2%-5% of the home’s purchase price. Keep in mind that closing cost amounts vary depending on a number of factors – such as the buyer’s loan program or negotiations made with the seller.

For example, if you’re buying a home in St. George, which has a median sale price of $500,000, closing costs could range anywhere from $10,000 to $25,000 . Or, let’s say that you’re buying a home in Salt Lake City, which has a median sale price of $593,000. Closing costs for a home here could add up anywhere from $11,860 and $29,650.

Who pays closing costs in Utah?

Generally, both buyers and sellers can expect to pay closing costs in Utah. But, each party’s closing costs amount will vary depending on what they are required to pay. Keep in mind that it’s common for the buyer to pay closing costs out of pocket, while the seller’s closing costs are typically deducted from the home sale proceeds.

Buyer closing costs in Utah

Closing costs in Utah for homebuyers tend to range between 2%-5%. If you’ve paid earnest money, which is typically 1%-3% of the home’s price, this amount will be subtracted from your closing costs. Below are some of the common closing costs paid for by the buyer:

• Appraisal fee: Your mortgage lender will require a home appraisal to ensure the home value is equal to or more than the loan amount. Home appraisals typically cost between $300 and $500, depending on location. If you pay at the time of service, it will not be included in your closing costs.
• Inspection fee: Home inspections in Utah generally range from $300 to $500 – they can vary based on local rates and the property’s specific characteristics. If you don’t pay for the inspection at the time of service, this will need to be paid at closing.
• Loan origination fee: Most lenders charge a fee for creating your loan. Be sure to check with your lender what this fee covers and if it can be waived or negotiated.
• Loan processing fee: In addition to the origination fee, your lender may also charge a fee for processing your loan. This typically covers underwriting and related services. It’s recommended to discuss this fee with your lender to understand what this fee covers and if it can be waived.
• Loan discount points: If you buy discount points to lower your interest rate, you’ll pay a one-time fee at closing. These points can lower your rate by 0.25% to 0.5%, but consider your long-term homeownership plans before paying for a reduced rate.
• Private mortgage insurance (PMI): Required for down payments under 20%, PMI might involve an upfront fee at closing, depending on the loan type. It’s usually part of your monthly payment, but some loans offer the option to pay it as a one-time fee.
• Title insurance: Title insurance is a one-time fee paid as part of closing costs. Buyers typically cover both lender and owner title insurance policies.
• Homeowners insurance: Your annual homeowners insurance premium may be included in your closing costs in Utah.
• Homeowners Association dues: If your property is part of a homeowners association, you’ll likely pay one month’s dues upfront at closing. These fees vary and contribute to maintenance and operational costs.
• Property taxes: As part of closing costs in Utah, you may be required to prepay a portion of your property taxes at closing.

Seller closing costs in Utah

How much closing costs are in Utah for sellers will vary between each transaction, but here are a few common closing costs that sellers typically pay for:

• Real estate agent commission fees: These fees can be a significant cost for sellers. Commission fees may vary and are subject to negotiation. Sellers should discuss their options with their agent.
• Homeowners Association fees: If the property is part of an HOA, the seller may need to pay a variety of fees. These can include HOA transfer fees, outstanding dues, and possibly a fee for obtaining HOA documents required by the buyer. The exact fees will depend on the HOA’s rules and regulations.
• Property taxes: Sellers are responsible for any property taxes that have accrued but not yet been paid up to the closing date. These unpaid property taxes are typically prorated for the months that you owned the property.
• Title insurance: Sellers typically cover the cost of the buyer’s owner’s title insurance policy. This policy protects the buyer from any potential title issues that may arise after the property is sold. The cost of title insurance can vary but is generally based on the property’s sale price.

Median home sale price data from the Redfin Data Center during July 2024.