Closing Costs
The fees and expenses associated with finalizing a financing transaction, such as origination fees, legal fees, or appraisal costs, paid at or before funding.
Closing costs vary significantly by product and lender, from minimal on some alternative financing products to a meaningful percentage of the loan on larger commercial real estate or SBA transactions that require appraisals, title work, or legal review.
Comparing closing costs alongside the headline rate or factor rate matters when evaluating financing offers, since a lower rate with high closing costs isn’t necessarily the cheaper option overall.
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