Shop and save on real estate closing costs

January 06, 2010 21:57 ET

Home Buyers Who Don't Delay Can Save on Closing Costs

New RESPA Regulations Make It Easier to Shop for Closing Services

SAN DIEGO, CA--(Marketwire - January 6, 2010) - Consumers will no longer be left in the dark about the closing costs involved to complete the sale or purchase of a home -- costs that account for an average of five percent of the purchase price.

Changes in the Real Estate Settlement Procedures Act (RESPA) that took effect on January 1 require lenders to fully disclose all closing costs, including the costs of obtaining a loan, and estimated costs for title insurance, settlement and other services within three days after a buyer applies for a mortgage.

Forms used in the closing process, including the Good Faith Estimate and the HUD-1 Settlement Statement, have been overhauled to make it easier for consumers to understand estimated costs and compare them with final costs at closing. The new GFE encourages consumers to shop and compare fees from various lenders before choosing a mortgage. The new HUD-1 makes it easy to compare the GFE estimates with the final HUD-1 closing statement and flag discrepancies prior to closing.

However, estimates provided by the Good Faith Estimate are usually binding for only ten days, unless there are certain changed circumstances. Buyers have only a few weeks to complete required tasks like reviewing their title report and retaining settlement services before the closing. They may have to act quickly to meet deadlines in sales contracts.

"The message to buyers is don't delay. Take control by working with your real estate agent to shop for and compare closing costs in your area. Compare the fees in your Good Faith Estimate with actual costs and the services provided by competing vendors," said Tony Farwell, CEO of, the Web's only one-stop-shop for real estate closing and related services. The Department of Housing and Urban Development estimates that consumers will save an average of $668 on every loan as a result of the new regulations.

Farwell said that homebuyers, working with their real estate professionals, should formulate a strategy to find the best vendors for their closing service needs in the short time available.

Here are some questions to cover with a real estate agent or broker:

1. Which closing services are required in your area and which are optional? Local laws and customs vary. Your agent may strongly recommend that you include optional services like a home inspection and home warranty.

2. On the Good Faith Estimate, did the lender use vendors who know your market well? It's a good idea to shop for alternatives that might be less expensive or provide better service. Many vendors provide a higher, blended rate for lender's to use in their GFEs that would be more costly than a quote for your transaction or property. Using, buyers and sellers can obtain instant rates customized for each transaction.

3. Upon reviewing your GFE, can you identify areas where you can save money without compromising quality? Smart buyers can save hundreds, even thousands, by finding their own closing cost providers. offers consumers a broad national database of more than 100,000 vendors providing closing services in 11 categories, including title insurance, home inspections, pest inspections, appraisals, notary and home warranty services. They can shop online for vendors, compare prices and services, and make more informed decisions.

About is the most comprehensive source for real estate closing services on the Web. The site is operated by ClosingCorp, an independent real estate information services company based in La Jolla, CA. The company's SmartGFE(SM) service enables loan originators to create instant Good Faith Estimates using live rates for real estate closing providers (title insurance, settlement services, home and pest inspections, home warranty, notary services, and more) with a few simple clicks. ClosingCorp does not own, sponsor or endorse any company that is listed on

Contact Information

    Kristin Ewald

    Steve Cook
    202 257-3652