How Much are Closing Costs in Mississippi?

As you get closer to calling Mississippi home, it’s time to tackle the final details—closing costs. These expenses might not be the most exciting part of buying a home, but they’re essential to wrapping up your purchase. Understanding what fees are involved means you can focus on settling in and enjoying everything Mississippi has to offer, from its rich history to its warm Southern hospitality.

Closing costs are the fees and expenses associated with finalizing a real estate transaction and transferring ownership of a property from the seller to the buyer. If you’re feeling unprepared or overwhelmed, don’t worry. To help you budget for closing costs, this Redfin article will cover how much closing costs are in Mississippi, who pays for them, and which costs you can expect to pay as a buyer and as a seller.

How much are closing costs in Mississippi?

Before securing the keys to your new home, homebuyers will need to pay for closing costs. Closing costs in Mississippi typically range between 2%-5% of the home’s purchase price. But it’s important to remember that this is just a range and the total amount will depend on various factors, such as the purchase price of the home, the type of loan, and any adjustments negotiated with the seller.

Let’s say you’re buying a home in Gulfport, where the median home sale price is $186,000. Based on this, you could expect closing costs to be between $3,720 and $9,300. Whereas if you’re buying a home in Jackson, which has a median sale price of $137,000, closing costs could be anywhere from $2,740 to $6,850.

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Who pays closing costs in Mississippi?

In most areas, including Mississippi, both the buyer and the seller will pay closing costs. But the buyer and seller will pay for different closing costs and likely have different total closing cost amounts. Keep in mind that it’s common for the buyer to pay closing costs out of pocket, while the seller’s closing costs are deducted from the home sale proceeds.

Buyer closing costs in Mississippi

Closing costs in Mississippi for homebuyers typically range between 2%-5%. If you paid earnest money, this amount will be subtracted from your closing costs, which will reduce the total amount you owe at closing. Earnest money is typically between 1%-3% of the home’s price. Let’s break down some of the common closing costs covered by the buyer:

• Appraisal fee: Home appraisals, which typically range from $300 to $500, are usually paid for separately at the time of the service. However, if not, you’ll need to pay for this at closing.
  
• Inspection fee: Although not required, a home inspection is highly recommended. Home inspections generally range from $300 to $500 in cost and are usually paid at the time of service. However, if not, it will need to be paid at closing.
  
• Loan origination fee: Your lender may charge a fee for creating your loan. It’s important to inquire about what this cost covers and whether it’s negotiable to potentially avoid high costs.
  
• Loan processing fee: In addition to the origination fee, your lender may also charge a fee for processing your loan. This typically covers underwriting and related services. It’s recommended to discuss this fee with your lender to understand what this fee covers and if it can be waived.
  
• Loan discount points: If you buy discount points to lower your interest rate, you’ll pay a one-time fee at closing. These points can lower your rate by 0.25% to 0.5%, but consider your long-term homeownership plans before paying for a reduced rate.
  
• Private mortgage insurance (PMI): Required for down payments under 20%, PMI might involve an upfront fee at closing, depending on the loan type. It’s usually part of your monthly payment, but some loans offer the option to pay it as a one-time fee.
  
• Title insurance: Title insurance is a one-time closing cost, with buyers commonly paying for both lender and owner policies.
  
• Homeowners insurance: In Mississippi, your annual homeowner’s insurance premium may be part of your closing costs.
  
• Homeowners Association dues: For homes in HOA-managed communities, you might have to pay one month’s dues at closing, which can vary depending on the property and covers maintenance and operational expenses.
  
• Property taxes: Buyers may have to prepay property taxes as part of their closing costs in Mississippi.

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Seller closing costs in Mississippi

How much closing costs are in Mississippi for sellers will vary between each transaction, but here are some of the common fees and costs covered by sellers:

• Real estate agent commission fees: These fees can be a significant cost for sellers. Commission fees may vary and are subject to negotiation. Sellers should discuss their options with their agent.
  
• Homeowners Association fees: If the property is part of a homeowners association, sellers are usually responsible for settling any outstanding HOA fees or assessments up to the date of closing. Additionally, sellers may need to provide certain HOA documents to the buyer as part of the sale.
  
• Property taxes: Any outstanding property taxes will be due at this time. However, if the seller has prepaid property taxes for the period that extends beyond the closing date, they may be credited back for the portion they’ve paid but won’t use.
  
• Title insurance: Sellers typically cover the cost of the buyer’s owner’s title insurance policy. This policy protects the buyer from any potential title issues that may arise after the property is sold. The cost of title insurance can vary but is generally based on the property’s sale price.

Median home sale price data from the Redfin Data Center during July 2024.