Average Closing Costs in Pennsylvania

Average closing costs in Pennsylvania range from $1,733 to $3,022. On a $200,000 home purchase, these fees represent 0.86 to 1.51% of purchase prices. The Keystone State is sandwiched between two states whose average mortgage fees are the lowest and second-highest in the nation. Pennsylvania’s average settlement fees rank 45th-lowest in the country, ahead of states such as Idaho, Utah and Wyoming.

Homebuyers can estimate affordability based on household income and expected purchase price of the dwelling. Analyzing closing costs associated with home purchases necessitates a deeper dive into the upfront cash outlay needed in addition to a down payment or mortgage points, if required.

Since the components of closing expenses vary from state to state, an examination of individual elements and fees is warranted before initiating the homebuying process. What follows is an explanation of each component and its average projected cost in the Commonwealth of Pennsylvania.

What Goes Into Pennsylvania's Closing Costs

The largest piece of closing costs is the origination fee that covers the expenses that a lender incurs during the processing of a mortgage loan. This cost includes the preparation of documents, checks on applicants’ creditworthiness and inspection of the property in question. Origination fees on a $200,000 home in Pennsylvania range from $1,055 to $1,101 in 2016. These fees, covering the cost of processing cumbersome paperwork, are sometimes negotiable dependent on the size of the home loan.

While the buyer incurs a cost from the lender, third-party expenses come in the form of an appraisal, required to assure the lender that the dwelling’s market value is aligned with the loan value. Lenders typically employ outside appraisers to calculate comparable market values of similar homes in the neighborhood and use those numbers to assess the agreed price of the prospective purchase. The average cost of an appraisal in Pennsylvania was $414, as of 2016.

An attorney is not required to represent the buyer at settlement, but a title search must be performed to ensure that the deed is clean and passes from the seller to the buyer without encumbrances. If the title is not free from liens or claims, the buyer can choose to nix the deal. Title insurance protects the buyer after purchase in the event an undiscovered claim against the property arises. The cost for a title company or attorney to perform the search in 2016 averages about $513 in the commonwealth.

A home inspection offers peace of mind to the purchaser. Inspectors examine the residence for structural issues, pests, radon gas or other adverse conditions that may affect the property value. The existence of undisclosed circumstances can lead to a renegotiation of the asking price or an outright cancellation of the purchase. The average cost for a home inspection in Pennsylvania runs about $125.

Smaller, ancillary fees add to closing costs. The buyer must cover the expense of postage or courier fees ($50), wire transfer fees ($50) if applicable, notary fees ($10) and flood certification ($10), a measure to ascertain whether the property lies in a floodplain, requiring the appropriate hazard insurance prior to settlement.

Rhode Island (RI): Average Closing Costs

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