Not sure how much cash you will need to close on a Kennewick home? You are not alone. Closing costs can feel confusing when you are trying to budget for a down payment and a move. This guide breaks down what closing costs include, typical ranges for Kennewick and Benton County, key timelines, and simple examples so you can plan with confidence. Let’s dive in.
What closing costs cover
Closing costs are one-time fees and prepaid items you pay to complete your purchase and, if you are financing, to set up your mortgage. They are separate from your down payment. You will see lender fees, title and escrow charges, third-party inspections, and prepaid items like insurance and property taxes.
How much to budget in Kennewick
You can use a simple rule of thumb: budget about 2% to 5% of the purchase price for buyer closing costs. The lower end often applies to cash buyers or highly negotiated loans. The higher end is more common when you pay for more third-party items or buy discount points to lower your rate.
- On a 300,000 purchase, plan for roughly 6,000 to 15,000 in closing costs.
- On a 600,000 purchase, plan for roughly 12,000 to 30,000.
Your final number depends on loan type and amount, lender fee policies, whether you choose an owner’s title policy, and how property taxes or HOA dues are handled at closing.
Line-by-line costs you may see
Lender and loan fees
- Origination or processing fee: commonly 0.25% to 1.0% of the loan amount, or a flat fee. Example: 0.5% on a 300,000 loan is 1,500.
- Application, processing, underwriting: typically 300 to 1,500 total. Some lenders bundle or waive these.
- Credit report: usually 25 to 50.
- Appraisal: often 400 to 800 in our region. Higher for complex properties.
- Rate lock or lock extension: varies by lender and timing.
- Discount points (optional): each point costs 1% of the loan amount to buy a lower rate.
- Mortgage insurance premiums (if applicable): upfront and/or monthly for FHA, VA, USDA, or conventional loans with lower down payments.
Title, escrow, and closing services
- Title search and title insurance: a lender’s policy is typically required. An owner’s policy is optional but strongly recommended to protect your ownership. Premiums are one-time based on price and loan amount.
- Escrow/settlement fee: covers managing funds and documents. In Washington, these fees are often split but can vary by agreement.
- Recording fees: Benton County charges to record the deed and your mortgage. Amounts vary by document type and pages.
- Notary: modest per-signature charges.
Third-party inspections and reports
- Home inspection: commonly 300 to 700 depending on size and scope.
- Pest or wood-destroying insect inspection: about 75 to 200.
- Survey or survey review: varies by need and property.
- Environmental or system checks as needed: septic, well, radon, or mold testing vary by property.
Prepaid items and escrow reserves
- Property taxes: prorated at closing. You usually reimburse the seller for taxes accrued through the closing date based on Benton County’s calendar.
- Homeowners insurance: the first year’s premium is often collected at closing for financed purchases.
- Prepaid interest: mortgage interest from your closing date to month-end.
- Initial escrow deposit: lenders typically collect reserves for taxes and insurance. Under federal rules, the cushion can be up to two months of the escrow payment plus the amounts needed based on the calendar.
- HOA dues and transfer fees: if the property is in an association, you may owe the first month’s dues and any transfer or admin fees.
Government and miscellaneous fees
- Recording fees: charged by Benton County for recording documents.
- Real Estate Excise Tax (REET): in Washington, this is typically paid by the seller, not the buyer, though contracts can negotiate costs.
- Flood certification: often 15 to 30 for the lender.
Washington and Benton County specifics
REET and who pays
Washington charges Real Estate Excise Tax on property sales. By custom, the seller pays this tax. Contracts can shift costs, so confirm who pays what in your purchase agreement.
Recording, taxes, and assessments
Benton County sets recording fees for deeds and mortgages, which vary by document. Property taxes are prorated at closing based on the county’s calendar and any amounts already paid. Some properties have municipal or special district assessments for items like sewer or stormwater. Ask for a municipal lien or assessment search so you are not surprised at closing.
Local customs and timing
Who pays for the owner’s title policy can vary in our area. Many sellers pay for it in some markets, while buyers cover it in others. Confirm with your Kennewick title company and make sure the purchase agreement reflects your agreement. Most financed purchases close in about 30 to 45 days after mutual acceptance, depending on appraisal timing, underwriting, and any repairs.
Timing, disclosures, and your protections
- Loan Estimate: after you submit a complete loan application, your lender must provide a Loan Estimate within three business days. Use this to compare lenders line by line.
- Closing Disclosure: you must receive your Closing Disclosure at least three business days before closing. It shows final numbers and explains any changes from the Loan Estimate.
- Wire safety: your escrow or title company will provide wiring instructions. Always call the title office using a verified phone number to confirm instructions before sending funds.
Examples to help you budget
The following are illustrations to help you plan. Actual amounts vary based on lender, title company, and property.
Example A: 300,000 purchase with financing
- Appraisal: 450
- Credit report: 40
- Origination and processing: 1,350 (about 0.5% of a 270,000 loan)
- Title, lender’s policy, and escrow fees: 1,200
- Owner’s title policy (if you pay it): 950
- Recording and misc.: 200
- Home inspection: 450
- Prepaid homeowners insurance (year one): 700
- Prepaid taxes and initial escrow deposit: 1,500
Illustrative total: roughly 6,000 to 10,000 depending on choices and escrow cushions.
Example B: 600,000 purchase with financing
- Using the 2% to 5% guideline, plan for 12,000 to 30,000 in closing costs. Several items scale with price or loan size, including origination percentages and title premiums.
How negotiations can lower your costs
- Seller concessions: you can ask the seller to contribute toward closing costs. Lenders limit how much the seller can contribute based on your loan type and down payment.
- Rate and fees tradeoffs: you can pay points to lower your rate, or opt for a slightly higher rate to reduce upfront costs. Your lender can show both scenarios.
- Finance certain costs: in some cases, costs can be rolled into the loan amount or covered by lender credits, subject to program rules and appraisal value.
Next steps for Kennewick buyers
- Get pre-approved and request a written Loan Estimate for your target price and down payment.
- Ask one or two Kennewick title or escrow companies for written fee estimates. Clarify lender’s policy, owner’s policy, escrow fee, recording fees, and any HOA transfer fees.
- Order your home inspection early in the process so you have time to negotiate repairs if needed.
- Ask your lender for an estimate of your initial escrow deposit for taxes and insurance. This can be a meaningful portion of your cash to close.
- Confirm the property tax status and proration details with the Benton County Assessor or Treasurer so you know what to expect.
If you want a clear picture of your cash to close based on a specific Kennewick home, reach out. You will get local numbers, straightforward answers, and guidance tailored to your loan type and timeline. Connect with Shana Brown to map your budget and next steps today.
FAQs
What closing costs do Kennewick buyers usually pay?
- Buyers typically pay lender and appraisal fees, the lender’s title policy, escrow and recording charges, inspections, and prepaid taxes, insurance, and interest.
Who pays Washington’s Real Estate Excise Tax (REET)?
- In Washington, REET is customarily paid by the seller, though your contract can negotiate a different arrangement.
When will I know my final cash to close?
- Your lender must give you a Closing Disclosure at least three business days before closing that shows your final numbers.
Can I roll closing costs into my loan?
- Some costs can be financed or covered with lender or seller credits, subject to loan program rules, appraisal value, and concession limits.
Do I need an owner’s title policy in Kennewick?
- It is optional but strongly recommended because it protects your ownership from covered title defects; confirm who pays for it in your purchase agreement.
How long does a financed purchase take to close?
- Most financed transactions in Benton County close in about 30 to 45 days, depending on appraisal timing, underwriting, and repairs.
