How Much Are Closing Costs in Ohio

Ohio is one of the most affordable states to reside in nationwide. Although some cities have high-priced neighborhoods, such as Cincinnati and Cleveland, overall living costs (including those for housing) are often cheaper than in the rest of the country. The average home price in the United States was $344,141 in 2022, while Ohio had a median home price of under $200,000.

Now that you've saved up for a deposit and found a mortgage with favorable terms, you're prepared to purchase a property in Ohio. But there's one final thing to think about: what are closing costs?

Ohio closing costs include all the legal and administrative fees you must pay in Ohio before getting the keys to your future home. Remember that every step of the home-buying process has costs, from filling out paperwork to paying for an inspection and an appraisal. Taxes and insurance charges are other expenses that affect the average closing costs. You'll pay these charges as well as your down payment in a single transaction on closing day. 

Even if you find a great deal on a house or a lovely piece of land in Ohio, you still need to save money for various home expenses. We have compiled the following guide to help you complete your property purchase in Ohio.

What Are the Average Closing Charges in Ohio?

How much are closing costs in Ohio? The average closing fees in Ohio are 2-3% of the home's purchase price. The average property price in Ohio is $139,600, so your closing costs could be anywhere from $2,792 to $4,188. Closing costs are not uniform and may vary for each buyer. Both lenders and the government mandate certain fees, while others are optional. Your closing costs will change based on the purchase price, location, and complexity of the home you're buying.

Breakdown of Typical Closing Costs in Ohio

The closing documents a buyer receives from their realtor will detail the home's purchase costs. You must either cover these costs in your loan amount or pay for them at closing. Buyers' closing expenses typically consist of the following:

• Loan Processing Fee: Your lender's invoice for their services

• Mortgage Points: Upfront costs that may result in a more favorable interest rate

• Underwriting Charges: Your mortgage application review fee

• Title Search and Transfer Charges: Charged by the title company

• Real Estate Attorney Charges: Charged in states that require legal representation for contract closing

• Homeowners Association Transfer Charges: Fees for relocating to an area with an HOA

A home appraisal and inspection charge may also be due at closing if not already paid. The home appraisal will determine the maximum loan amount you can obtain from a lender and helps you avoid overpaying for a home. Appraisals typically cost $300-$600 but may sometimes go higher. 

The typical closing expenses in Ohio are much lower than in other states. In 2021, buyers paid an average of $4,256 in closing expenses or $3,376 after taxes. Buyers also saved an average of $2,560 by relocating to Ohio instead of elsewhere.

Despite these relatively low costs, Ohio buyers spent more on closing fees overall. The average buyer in Ohio spent 2.11% of their home's worth on closing costs, compared to 1.03% across the rest of the country. 

Saving on Closing Fees in Ohio

These tips, tricks, and tactics can help you save money on closing costs when purchasing a home in Ohio.

1. Get Help With Closing Costs

Homebuyers in Ohio may qualify for various programs designed to help them become homeowners, including low-interest mortgage loans, down payment assistance, and help with closing costs. The Ohio Finance Authority, various homeownership help programs, and benefits for those working in the public service profession in Ohio are all examples of the types of assistance available to state residents.

2. Organize Your Finances

Have your money and credit report in order when applying for a mortgage. You can save thousands of dollars in interest throughout your mortgage if you prove to a lender that you're a responsible borrower. Avoid missing payments on existing loans, reduce your debt-to-income ratio, and build your credit history before applying for more financing.

3. Reductions Offered by the Seller

Negotiation is standard when buying or selling a home. If you're a buyer in a seller's market, don't be afraid to ask the seller to cover all or some of your closing costs. You can submit a full-price bid stipulating that the seller covers all the costs associated with the sale.

4. Include Closing Costs in Your New Mortgage

You can finance closing cost fees by including them in the mortgage. The fees will be rolled into your monthly mortgage payment instead of being paid at closing. This might seem like a good idea at the time, but remember that you'll pay interest on the closing costs for the duration of your loan. 

Understanding Seller Contributions to Closing Charges in Ohio

Your seller may be willing to contribute to your closing costs, especially if you're in a buyer's market. When asking the seller for a concession, you should know how much they can afford to give you based on the type of loan you're getting. If you ask for too many concessions in a market where the seller has the upper hand (also known as a seller's market), they may reject your offer.

The Benefits and Drawbacks of Seller Contributions to Closing Fees in Ohio

Seller concessions reduce the final purchase price of a home by reducing the amount owed at closing. As a buyer, you will typically need to pay for your closing costs and down payment at closing, which can total at least several thousand dollars. Seller concessions can significantly reduce these expenses, helping you purchase a home without fully depleting your savings.

Remember that if you ask for too many discounts from the seller, your offer may look less desirable to them. Most sellers prefer offers without many conditions, particularly in a seller's market.

Alternatives to Seller Contributions to Closing Fees in Ohio

Planning your closing date on the last days of the month will help you save money. Mortgage interest is calculated every month based on the number of days you own the property. Your interest will be lower if you only have possession for a small fraction of the month.

Many states also offer down payment and closing cost assistance programs for homebuyers, especially those purchasing their first homes. For example, the Ohio Housing Finance Agency provides down payment and closing cost help for 2.5-5% of a home's purchase price.

Why Do You Need to Plan For Closing Costs?

You should prepare for closing costs in advance because they may increase your total loan amount and raise your monthly payments. Closing expenses affect everyone, including cash buyers, so setting aside enough money to cover them is important. 

The Consequences of Not Planning for Closing Fees in Ohio

When you plan to buy a home in Ohio, failing to plan for closing costs can lead to delayed closings, missed opportunities, and offer rejections. Review loan estimates and third-party research services to ensure you understand what your closing costs entail.

How Planning for Closing Costs Can Benefit Ohio Homebuyers in the Long Run

Planning for closing costs is essential for homebuyers in Ohio to prepare for extra expenses on closing day. Doing thorough research on closing costs allows buyers to explore their financing options, like including the closing costs in a mortgage or getting help from closing costs assistance programs.

Bottom Line

Lenders will charge you closing charges to cover the time and effort they put into processing your loan. Mortgage closing costs are typically between 2% and 3% of the loan amount. Average closing costs in Ohio include appraisal, legal, and inspection fees. The property value, local regulations, and loan type all play a role in determining the final sum you'll need to pay at closing.

Find a local real estate professional to get the inside scoop on how to prepare for the home-buying process. Redy connects homeowners with licensed real estate agents who submit proposals to represent their home sales. Each proposal includes a listing term, commission rate, information about the agent, and cash bonus. By putting all the negotiating cards on the table – and having the agent invest in the home sale upfront – we empower home sellers to make more informed decisions. Create your free account to get started!

To learn more about selling your home, visit our Home Seller Resources >