Buying in Salt Lake and wondering what you will owe at closing beyond your down payment? You are not alone. Closing costs in Honolulu can surprise first-time and relocating buyers, especially with condo fees and Hawaii-specific items. This guide breaks down what you will pay, who usually pays what in Hawaii, typical ranges, and simple ways to save. Let’s dive in.
What closing costs include
Closing costs are the one-time charges due when you finalize your purchase. For Salt Lake buyers, they usually include lender fees, title and escrow services, government and recording charges, prepaid items, inspections, and any condo or HOA transfer fees. Total costs typically run about 2 to 5 percent of the purchase price. In Honolulu, dollar amounts can be higher because property prices are higher.
What buyers typically pay in Honolulu
Customs can vary, and many items are negotiable in Hawaii. Here is what you will usually see as a buyer in Salt Lake, Aliamanu, or Foster Village.
Lender fees and appraisal
- Application and origination: 0 to 1 percent of the loan amount or a flat fee, often $500 to $3,000.
- Underwriting, processing, and doc prep: about $300 to $1,500 combined.
- Credit report: about $25 to $50.
- Appraisal: usually $500 to $900 in Honolulu, higher for complex properties.
- Mortgage insurance if your down payment is under 20 percent or based on loan program.
- Optional discount points to lower your rate (1 point equals 1 percent of the loan amount).
Tip: Compare at least two Loan Estimates. Lenders follow federal TRID rules, so you can compare fees line by line.
Title, escrow, and recording
- Title insurance: a lender’s policy is typically required if you finance and the buyer usually pays it. An owner’s policy protects your ownership and who pays is often negotiated in Hawaii. Costs scale with price, from several hundred to a few thousand dollars.
- Escrow or settlement fee: commonly split or negotiated. Expect roughly $300 to $1,200 or more depending on price and provider.
- Recording and county charges: usually small fixed amounts, about $50 to $200.
Government and transfer taxes
- Hawaii Conveyance Tax: this is Hawaii-specific. It is customarily paid by the seller in many transactions. Always confirm in your contract and with escrow.
- Documentary and recording taxes: modest county fees apply; your escrow officer will itemize them.
Prepaids and prorations
- Prepaid mortgage interest: from your closing date through month-end.
- Homeowner’s insurance: most lenders require you to pay the first year’s premium at closing.
- Property taxes: prorated based on Honolulu County’s schedule and your closing date.
- HOA dues and assessments: prorated from the day after closing; some associations collect the first month or quarter at closing.
Condo and HOA fees in Salt Lake
Salt Lake has many condos and townhomes. Expect a few condo-specific items.
- Resale or estoppel certificate: confirms dues, assessments, and rules. Often $100 to $400. Who pays varies; buyer payment or splitting is common in Hawaii.
- HOA transfer or move-in fees: often $100 to $500 or more.
- HOA application fees if required.
- Any special assessments disclosed in the resale packet can affect your budget post-closing.
Timing note: Resale packets can take 7 to 21 days. Order early so you do not delay contingencies or closing.
Inspections and specialty reports
- Home inspection: typically $300 to $800.
- Pest or WDO inspection: common and smart in Hawaii. Often $75 to $200 for the report; treatment is separate if needed.
- Specialist inspections if concerns arise, such as roof or sewer.
- Optional legal review of condo documents if you want an attorney’s opinion.
Other possible costs
- Survey if required by lender or by you: often $300 to $900.
- Courier, overnight, and notary services as needed.
How much to budget in Salt Lake
Plan for about 2 to 5 percent of the purchase price, depending on loan type, price point, and condo items. These examples are illustrative estimates. Always request written quotes from your lender and escrow company.
- Example A: $600,000 purchase with 20 percent down. Estimated buyer closing costs at 2 to 4 percent equal about $12,000 to $24,000. Typical breakdown: lender and appraisal $2,000 to $5,000; title and escrow $1,500 to $3,000; title insurance $1,000 to $2,500; prepaids $2,000 to $6,000; inspections and HOA documents $500 to $1,500.
- Example B: $900,000 purchase with 10 percent down. Estimated buyer closing costs at 2 to 5 percent equal about $18,000 to $45,000. Title and escrow scale up with price, and you may have mortgage insurance with less than 20 percent down.
What sellers usually cover in Hawaii
Customs can vary by contract and negotiation, but a few patterns are common in Honolulu.
- Conveyance Tax: typically a seller cost in Hawaii. Confirm in your purchase contract.
- Real estate commissions: typically paid by the seller.
- Title and escrow: often split or negotiated.
- Owner’s title insurance: who pays can vary by local practice. Ask escrow what is typical for your property type and area.
Ways to reduce out-of-pocket costs
You have options to lower cash due at closing while keeping your long-term costs in view.
- Ask for a seller credit toward closing costs. This is negotiated in the contract and subject to lender limits.
- Shop lenders and compare Loan Estimates. Ask about origination vs. rate tradeoffs and lender credits.
- Request the seller to cover specific fees like an HOA transfer or owner’s title policy if local custom supports it.
- Consider lender credits in exchange for a slightly higher rate after you compare lifetime costs.
- Time your closing date near month-end to reduce prepaid interest.
Timeline and local tips
- Typical escrow in Honolulu runs about 30 to 45 days. Your loan type and condo document timing can lengthen or shorten this.
- For condos, order the estoppel or resale certificate early. It can take 7 to 21 days and often controls your document review period.
- Plan for a WDO inspection during your contingency window. It is common in Hawaii and wise in our climate.
- Verify property tax prorations with escrow based on Honolulu County’s schedule.
- Confirm insurance early. Salt Lake sits centrally and is not a large floodplain, but you should still check flood zone maps and first-year premium estimates.
Quick buyer checklist
Use this list to keep your closing costs clear and under control.
- Ask your lender for a detailed Loan Estimate and compare at least two lenders.
- Request an itemized quote from escrow for title insurance, escrow fees, and recording.
- Confirm who pays the owner’s title policy locally and what is written in your contract.
- For condos, ask for the HOA resale packet timeline, estoppel fee, transfer fee, and any pending special assessments.
- Verify property tax proration and any prepaid amounts you will reimburse.
- Confirm conveyance tax treatment and that it is accounted for on the seller side unless negotiated otherwise.
- Schedule home and WDO inspections promptly.
Common mistakes to avoid
- Only budgeting for the down payment and forgetting the 2 to 5 percent in closing costs.
- Waiting to order condo documents, which can delay closing.
- Not comparing lender quotes and leaving money on the table.
- Assuming the seller will pay a fee without confirming in the contract.
- Overlooking prepaid items like insurance and interest when planning cash to close.
Get a local estimate you can trust
Every Salt Lake purchase is unique. Your exact fees depend on your loan, property type, HOA requirements, and timing. Start early by requesting a Loan Estimate from your lender and a fee quote from escrow, then review them against your contract. If you want a clear, customized breakdown for a specific Aliamanu, Salt Lake, or Foster Village property, connect with a local advisor who handles these details every week.
Have questions or want a side-by-side estimate before you write an offer? Reach out to Melvin Leon Guerrero for a tailored closing cost review and strategy.
FAQs
How much should a Salt Lake buyer budget for closing costs?
- Plan for about 2 to 5 percent of the purchase price, with dollar amounts higher in Honolulu because home prices are higher.
Who pays Hawaii’s Conveyance Tax in Honolulu sales?
- It is typically a seller cost in Hawaii, but always confirm in your purchase contract and with escrow.
Do Salt Lake condo buyers have extra fees?
- Yes. Expect an estoppel or resale certificate, possible transfer or move-in fees, and proration of HOA dues and any disclosed assessments.
What inspections are common for Honolulu homes and condos?
- A general home inspection and a pest or WDO inspection are common and advised. Your lender or loan type may require certain reports.
Are title insurance costs negotiable in Hawaii?
- Lender’s title insurance is usually a buyer cost when financing. Owner’s title insurance is often recommended and who pays is negotiable by local custom.
Can buyers roll closing costs into the loan?
- Some costs can be offset with lender credits in exchange for a higher rate, and certain programs allow financed costs. Compare long-term impacts before deciding.
How long does escrow usually take in Honolulu?
- Many escrows close in about 30 to 45 days. Condo document timelines and loan processing can affect duration.
