Guidelines for Calculating Closing Costs

Some General Principals
1. ’Tis better to overestimate than underestimate
2. First payment on a new loan will be due on the 1st day two months after the settlement ( i.e., close in February, 1st payment is April 1)
3. Loan interest is paid in arrears
Seller costs
1. Payoffs
  1. RoT: Add 1 payment to principal balance
2. Releases ($95.00 per release, $53 per release recordation)
3. Tax Adjustments (usually a credit in MD, debit in DC)
4. Transfer and Recordation Taxes (see below)
5. Settlement Fee($250.00), Courier($20),Wire($25 per), MD Withholding($45)
Buyer costs
1. Transfer and Recordation Taxes
  1. Maryland (MoCo)
    1. Total of 2.19 % of purchase price
      Effective 3/1/08, add an additional .31% to the amount in excess of $500,000
    2. Parties split unless otherwise agree (almost 1.1% each)
    3. FTMHB
      1. exempt from State Transfer only
      2. Seller pay unless otherwise agree
    4. Owner Occupant
      1. 1st $50K exempt from State Recordation only
      2. $345.00 savings ($172.50 each if split)
  2. D.C.
    1. Total of 2.9% (if under $400,000.00, total of 2.2%)
      1. Transfer Tax (Seller) 1.45% (1.1% if under $400K)
      2. Recordation Tax (Buyer) 1.45% (1.1% if under $400K)
    2. parties split unless otherwise agreed (1.45% each)
2. Escrows
  1. Property taxes
    1. Maryland (www.montgomerycountymd.gov/apps/tax)
      1. Tax year runs 7/1 to 6/30
      2. Taxes payable:
        9/30 (7/1 – 12/31)
        12/31(1/1 – 6/30)
      3. need 11 months by September payment
      4. Estimated Months of Escrow needed:
        J(4);F(5);M(6);A(7);M(8);J(9); J(10);A(11);S(6);O(7);N(8);D(3
    2. D.C. (www.taxpayerservicecenter.com)
      1. Tax year runs 10/1 to 9/30
      2. Taxes payable:
        3/15 (10/1 – 3/30)
        9/15 (4/1 – 9/30)
      3. need 8 months by March or September payment
      4. Estimated Months of Escrow needed:
        J(7);F(8);M(3);A(4);M(5);J(6);
        J(7);A(8);S(3);O(4);N(5);D(6)
  2. Homeowner’s coverage
    1. Need 1 year up front plus 3 months
3. Title Insurance
  1. Figure $4.50 per $1,000.00 ($5.70 for DC)
  2. Ask us about possible reissue discount
4. Tax Adjustments (usually debit in MD, credit in DC)
5. One Title Fee, including title abstract ($725)Purchase or ($799) Re-Finance
6. Filing Fees
  1. MD: $40.00 per document (estimate $80.00)
  2. DC $26.50(1st 2 pages) , then $7.00 per page (estimate $221.00)
7. Tax escrows by title company
  1. MD (September and December)
  2. DC (March and September)