Closing costs are the fees and charges due at closing beyond the down payment itself — the collection of costs that pay for all the work, insurance, and government processes required to originate a loan and transfer (or refinance) a property. They cover the services performed by third‑party professionals, the lender’s own costs of approving and funding the loan, and the legal steps required to record the transaction. Closing costs are separate from prepaid expenses, which are future costs collected upfront, such as property taxes, homeowner’s insurance, and daily interest.
Because closing costs combine so many different items, they can catch first‑time buyers off guard if no one walks them through what’s actually in that number. Each cost serves a specific purpose, and as your glossary grows, each of these items will have its own dedicated entry. For now, here is the core list of what typically appears in a New Hampshire closing.
Settlement Agent Fees The settlement agent — in New Hampshire, typically an attorney or title company — prepares the closing documents, conducts the title search, coordinates the transfer of funds, and ensures the deed and mortgage get properly recorded. Their fee covers this work and is one of the larger line items in the closing cost total.
Appraisal The fee paid to the licensed appraiser for their inspection and valuation of the property. This is usually collected upfront or at closing, depending on the lender.
Lender’s Title Insurance A policy that protects the lender against claims or defects in the property’s title that a title search may have missed — things like an undisclosed lien, a forged signature in the chain of ownership, or an heir who was never notified of a sale. This is required by virtually every lender and is a one‑time premium paid at closing.
Owner’s Title Insurance A separate policy that protects the buyer’s own equity in the property against those same kinds of title defects. This one is optional — lender’s title insurance protects the lender, not the buyer — but it’s strongly recommended, since it’s the buyer who stands to lose their investment if a title problem surfaces years later. In New Hampshire, buyers are often offered a discounted “simultaneous issue” rate when purchasing owner’s coverage at the same time as the lender’s policy.
Recording Fees Fees charged by the county registry of deeds to officially record the new deed and mortgage in the public record. These are set by the county, not the lender, and are typically calculated per page.
Credit Report Fee The cost of pulling a borrower’s tri‑merge credit report (all three bureaus) through a mortgage‑specific credit reporting service. This report is more detailed than a consumer credit report and is what underwriting relies on.
Underwriting or Processing Fee A fee charged by the lender to cover the cost of underwriting and processing the loan file. This can go by many names — underwriting fee, processing fee, administration fee, application fee — but it generally represents the same thing: the lender’s cost of putting the file together and getting it approved.
Flood Certification A small fee for a flood zone determination, which confirms whether the property sits in a FEMA‑designated flood zone. If it does, flood insurance will be required as a condition of the loan.
Closing costs like these are often grouped separately from two other categories that also show up at the closing table but represent something a little different:
Discount Points An optional, upfront fee paid to buy down the interest rate for the life of the loan. Each point generally costs 1% of the loan amount. Unlike the fees above, discount points aren’t the cost of a service; they’re essentially prepaid interest exchanged for a lower rate.
Prepaid Expenses Amounts collected at closing to reimburse the seller for property taxes or HOA fees paid in advance and to fund the first deposits into taxes, insurance, and, if applicable, HOA dues. This also includes prepaid interest covering the days between closing and the start of the first full mortgage payment cycle. These aren’t fees at all; they’re the borrower’s own money, front‑loaded to make sure the escrow account starts with enough cushion.
Fuel Proration This is not a fee charged by the lender, but the standard sales agreement used in New Hampshire calls for a proration of fuel. At today’s costs, this can be a considerable amount if you’re not expecting it. Fuel proration doesn’t show up on the Loan Estimate or on the preliminary Closing Disclosure, so be prepared to see this expense added to your final closing figure.
Independent Mortgage Broker Fee On loans originated through an independent mortgage broker, rather than a retail bank or direct lender, there may be a separate broker fee disclosed on the Loan Estimate and Closing Disclosure. Depending on how the loan is structured, this fee may be paid by the borrower, paid by the lender through lender‑paid compensation, or split between the two — but it cannot be paid by both the borrower and the lender on the same loan under current regulations.
In everyday terms, closing costs are simply everything it costs to get a loan closed and a title transferred — some of it paying for services performed on your behalf, some of it paying for insurance protecting you or the lender, and some of it, like prepaids, just your own money getting front‑loaded into your new escrow account.