windyMagician
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Simple English definitions for legal terms
recurring closing costs
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A quick definition of recurring closing costs:
Recurring closing costs are the expenses that a homeowner must pay regularly after buying a home. These costs include things like prepaid interest, HOA fees, insurance, and property taxes. They are different from one-time costs, called nonrecurring closing costs, which are paid only once when buying the home.
A more thorough explanation:
Recurring closing costs are expenses that a homeowner must pay after purchasing a home. These costs are the first of a series of payments that will continue over time. Examples of recurring closing costs include:
- Prepaid interest
- Homeowners’ association (HOA) fees
- Homeowners' insurance
- Property taxes
For instance, if a homeowner pays $1,200 in property taxes annually, this cost will recur every year. Similarly, if a homeowner pays $100 per month for HOA fees, this cost will recur every month.
Recurring closing costs are different from nonrecurring closing costs, which are one-time expenses that a homeowner pays at the time of purchase. Examples of nonrecurring closing costs include appraisal fees, title insurance, and attorney fees.