Since 2010, it has been a long, slow slog for West Virginia's housing market. Housing prices managed to recover from the worst declines in the country, only to crater again in 2014, as the state's coal industry was decimated by lower energy costs, closings and job losses. At $95,000, 2016 home values are now closer to their 2010 low of $91,000 than they are to their 2014 peak of $104,000. That is good news for homebuyers looking to buy their dream homes at affordable prices.

However, homebuyers need to brace themselves at settlement time; closing costs in West Virginia are among the highest in the country. Homebuyers can expect to pay 3 to 5% of their home's value in closing costs. Although many closing costs are fixed, some may be negotiable, and some can even be rolled into the loan to minimize out-of-pocket costs. Because closing costs vary among lenders, homebuyers should compare them, starting with an understanding of the average closing costs across the state.

Average Closing Costs in West Virginia

On average, homebuyers in West Virginia pay $1,067 in lenders' fees and $904 for third-party fees, for a total of $1,971 in average closing costs. That is well above the national average of $1,847 and among the highest in the country, just below Hawaii, Connecticut and New Jersey. The lowest closing costs are found in Utah, Wyoming, Idaho and Ohio, which are all below $1,700.

West Virginia homebuyers pay an average of $80 for document preparation, $1,118 for origination fees, $75 for tax services, $468 for a home appraisal, $734 for closing or settlement costs, $21 for a credit report, $125 for a pest inspection, $100 for courier services and $490 for a survey.

Title insurance fees are not included in these averages because lenders may have a difficult time in estimating them, but these fees can add as much as $1,000 to the closing costs. Prepaid items such as property taxes and homeowners insurance are also not included. These average closing costs are based on a home valued at $200,000, with a 20% down payment. With a median home value of $95,000, many West Virginia homebuyers may pay less.

What Goes Into Closing Costs?

Closing costs in West Virginia can vary among lenders and based on the type and size of property. However, these are the more common closing costs homebuyers will find of a good faith estimate provided by lenders.

• Loan origination or lender fees: This is an all-inclusive fee charged by the lender to cover the cost of processing the loan through funding. The fee is stated in points, with each point representing 1%. Most lenders charge one point for these services. However, homebuyers who wish to negotiate for a lower interest rate can do so by adding points to their closing costs.

• Appraisal fee: Lenders require an independent appraisal of the property to confirm that its value is in line with the listed sale price and the sale price of comparable homes in the area.

• Settlement/closing fee: In West Virginia, the title company handles the legal aspect of closing escrow. Homebuyers who want their own legal representation in the settlement can hire a private attorney at their own expense.

• Title insurance: The homebuyer is required to buy a title insurance policy on the lender to protect it against any title defects that could threaten its position as the top lien holder. The seller is required to purchase title insurance on the buyer to guarantee a clear title on the property.

• Tax services: In West Virginia, tax liens take precedence over first mortgages. Depending on the amount of the down payment and the value of the home, some lenders may set up a property tax impound account, which it monitors to ensure that tax payments are current.

• Survey: On some properties, lenders may require a survey to ensure the integrity of the property lines in order to avoid any property line issues that might arise.

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