Closing cost is a fees paid by the borrower to effect the closing of a mortgage loan.

For Example, attorney fees, survey, insurance escrow payments, etc. It is also known as settlement cost.

Features of closing Cost are as following:

1. It ranges between 3% and 6% of the loan amount.
2. Its percentage will change according to the area of the country.
3. It can be of two types -
   • Recurring closing cost.
   • Non Recurring closing cost
4. It is made up of individual closing cost items such as -
   • Origination fees
   • Attorney fees
   • Taxes
5. An amount placed in escrow.
6. Charges for obtaining title insurance and a survey.
7. Many closing cost items are included as numbered items on the HUD-1 statement.