The closing costs are the costs a buyer or a seller needs to pay to close a deal of house purchase. There are two types of closing cost: nonrecurring and recurring. While recurring costs are those costs that are paid annually, such as property taxes or property insurance, nonrecurring closing costs are the costs that need to be paid only once for the closing of a home purchase. These costs include escrow fee, the title insurance, the appraisal fee, the underwriting fee, the notary fee, the recording fee, and the transfer taxes, among other things. Depending on the size of the purchase and the amount of transfer taxes, these fees can have very different amount.
[Last updated in August of 2020 by the Wex Definitions Team]