With the housing market varying so much across the country, many people assume that mortgage interest rates vary greatly from state-to-state as well. While there may be slight variations in mortgage interest rates, they are generally the same. Consequently, Arizona mortgage rates are as competitive as those in any other state.

There can be, however, significant differences in closing costs and procedures across the nation. So, when you apply for your mortgage, don’t forget to factor in closing costs or your hard work to find a competitive Arizona mortgage rate may be tempered by unforeseen closing costs.

What Closing Is

Before you try to discern the differences in closing costs, you must first understand what “closing” is. Closing is the final step before you take ownership of your home. During the closing, you will sign mortgage loan documents, transfer funds (escrow, insurance, etc…), and receive the deed to your property.

Closing Costs

Arizona closing costs—at around $2600 –sit right at the national average. Typically, closing costs cover the following items:
o Lender Fee
o Title Insurance
o Title Search Fee
o State Mortgage Taxes
o Settlement Charge
o Escrow
o Settlement or Closing Fee
o Attorney’s Fee
o Flood Insurance Fee
o Home Warranty Fee
o Home Inspection Fee
o Survey Fee
o Notary Fee
o Recording Fee
o Interest
o Lender Fees/Charges

Closing in Arizona

Closing procedures vary as much as closing costs. Whether you are a first-time homeowner—or a newcomer to Arizona, knowing what to expect at closing will make the process much easier and less stressful.

In Arizona, title companies and title agents both handle closings. The seller usually pays for the owner’s title policy, and the buyer pays for the lender’s policy. All other escrow costs are split. There are no documentary, transfer, or mortgage taxes. Property taxes are due in installments; with the first installment on October 1, and the second installment due on March 1. Your closing date will determine what you need to have available for escrow, so be sure to ask your lender.

No matter what state you buy your home in, having a general idea of the closing costs and procedures specific to your area will ensure that you are well prepared for the final step in purchasing your home. Remember, you spent a great deal of time finding the best mortgage rates in Arizona. Don’t let unexpected closing costs ruin what can be a gratifying and rewarding experience—buying your home.