Seattle Condo Buyer Closing Costs

What Closing Costs Should You Expect?

Closing costs are the fees and expenses you pay at the time your condo purchase is finalized. For Seattle condo buyers, these typically run between 2% and 4% of the purchase price. On a $500,000 condo, that means roughly $10,000 to $20,000 on top of your down payment.

Understanding these costs upfront helps you budget accurately and avoids surprises at the closing table. Here is a breakdown of the major line items.

Lender Fees

If you are financing your purchase, your lender will charge several fees:

• Loan origination fee: Typically 0.5% to 1% of the loan amount. Some lenders waive this in exchange for a slightly higher interest rate.
• Appraisal fee: $500 to $800 for a standard condo appraisal. Condo appraisals can be more complex than single-family appraisals because the appraiser must also evaluate the building and HOA.
• Credit report fee: Usually $30 to $75.
• Underwriting and processing fees: Vary by lender, typically $500 to $1,000 combined.
• Condo questionnaire fee: The management company charges $200 to $500 to complete the lender's condo questionnaire. This is a condo-specific cost that single-family buyers do not encounter.

Title and Escrow Fees

• Title insurance (owner's policy): Protects your ownership interest. Cost is based on the purchase price, typically $800 to $2,000.
• Title insurance (lender's policy): Required by your lender. Usually $300 to $700.
• Escrow fee: The escrow company charges for managing the transaction and holding funds. Typically $500 to $1,200, often split between buyer and seller.
• Title search and examination: $150 to $400.

Government and Recording Fees

• Recording fees: King County charges fees to record the deed and mortgage documents. Typically $100 to $300.
• Real estate excise tax (REET): In Washington State, the seller traditionally pays the excise tax, but this is a negotiation point. Buyers should confirm who is responsible in the purchase agreement.

Prepaid Items

At closing, you will prepay certain expenses that cover the period between your closing date and the first regular payment cycle:

• Prepaid property taxes: You will be asked to prepay a portion of the year's property taxes into an escrow account. The exact amount depends on your closing date and the county's tax schedule.
• Prepaid homeowners insurance: Your HO-6 condo insurance policy premium for the first year, plus an initial deposit into your escrow account for future premiums. Typical annual premiums range from $200 to $600.
• Prepaid interest: Interest on your mortgage from the closing date through the end of that month. This is a per-diem charge based on your loan amount and interest rate.

Condo-Specific Costs

Several closing costs are unique to condo purchases:

• Resale certificate fee: The seller typically pays for the resale certificate, but buyers should confirm. The cost ranges from $250 to $500.
• HOA move-in fee: Many buildings charge a move-in fee or deposit. This can range from $200 to $1,000 depending on the building.
• HOA transfer fee: Some associations charge a fee to transfer ownership records. Typically $100 to $300.
• First month's HOA dues: You may need to prepay your first month of HOA dues at closing.

Optional but Recommended Costs

• Home inspection: $350 to $600 for a thorough condo inspection. Not a closing cost per se, but a pre-closing expense every buyer should budget for.
• Sewer scope: Not typically applicable for condos (the HOA maintains shared sewer lines), but occasionally relevant for townhome-style condos.

How to Reduce Closing Costs

There are a few legitimate ways to reduce your out-of-pocket closing costs:

• Negotiate seller credits: In some market conditions, sellers will agree to credit the buyer a portion of closing costs as part of the purchase agreement.
• Shop lender fees: Get loan estimates from multiple lenders and compare origination fees, underwriting costs, and rate offerings.
• Ask about lender credits: Some lenders offer credits toward closing costs in exchange for a slightly higher interest rate. This can make sense if you plan to refinance or sell within a few years.

I walk buyers through a detailed cost estimate before they write an offer so there are no surprises at closing. If you are planning a condo purchase in Seattle and want a clear picture of what to expect, get in touch. Accurate budgeting starts well before you find the right unit.