How Much Are Closing Costs in Mississippi? 

When you’re buying or selling a home in Mississippi, closing costs are an important part of the financial picture you need to understand. These fees can add up quickly and impact your budget, so knowing what to expect and how to prepare is essential. Whether you’re a first-time homebuyer or selling your longtime residence, this guide will help you answer the question, “ How much are closing costs in Mississippi?” and what factors influence them.

What Are Closing Costs?

Closing costs are the fees and expenses you pay when finalizing a real estate transaction. They go beyond the purchase price of the home and cover various services needed to complete the sale. These can include lender fees, title insurance, escrow charges, taxes, and more. Both buyers and sellers have closing costs, but the specific fees and amounts they pay often differ.

Closing Costs Breakdown for Buyers in Mississippi

When buying a home in Mississippi, closing costs typically range from 2% to 5% of the purchase price. This means that on a $250,000 home, you might expect to pay between $5,000 and $12,500 in additional fees at closing. Understanding what goes into these costs helps you budget better and avoid surprises on closing day.

Key Buyer Closing Costs Explained:

Loan Origination Fee:
This fee is charged by your lender to process and underwrite your mortgage loan. It usually runs between 0.5% and 1.5% of the loan amount. For example, on a $200,000 loan, this could be $1,000 to $3,000. It covers administrative costs and lender overhead.

Appraisal Fee:
Your lender will require an appraisal to verify the home’s market value before approving the loan. This typically costs between $400 and $500. The appraisal protects both the lender and you from overpaying.

Home Inspection:While not always mandatory, a home inspection is highly recommended to assess the condition of the property. Fees vary depending on the property’s size and location but usually range from $100 to $500. Inspections can uncover costly repairs or maintenance issues before you buy.

Title Insurance:
Title insurance protects you and your lender against potential disputes over property ownership. In Mississippi, this often costs about $4.25 per $1,000 of the loan amount. It’s a one-time fee paid at closing.

Escrow Fees:
Escrow companies act as neutral third parties to manage the transfer of funds and documents. Escrow fees vary but may include holding prepaid property taxes and insurance premiums, often requiring a couple of months’ worth of payments upfront.

Other Possible Costs for Buyers:

• Credit Report Fee: Small fee charged by the lender to pull your credit history.
• Recording Fees: Charged by the county to record your new deed and mortgage.
• Prepaid Interest: Depending on the closing date, you might owe interest for the remaining days of the month.

Cash Buyers Have It Easier

If you’re buying a home without a mortgage, your closing costs will generally be lower—closer to 1% of the purchase price—because you avoid loan-related fees like origination and appraisal.

Knowing these details helps buyers negotiate and plan effectively. Don’t hesitate to ask your real estate agent or lender for an estimate early in the process so you can factor closing costs into your overall budget.

Closing Costs Breakdown for Sellers in Mississippi

Sellers typically face closing costs ranging from 2.87% to 5.30% of the sale price. For a home sold at $250,000, this equates to roughly $7,175 to $13,250 in fees, though exact amounts depend on your sale terms and location.

Common Seller Closing Costs:

Agent Commission:
The largest expense for most sellers, agent commissions usually total around 5.30% of the sale price, split between the listing agent and the buyer’s agent. On a $250,000 sale, that’s about $13,250. Some sellers save money by using flat-fee MLS listings or negotiating lower commissions.

Owner’s Title Insurance:
Sellers often pay for the owner’s title insurance policy, which protects the buyer against title defects. This cost is usually around $4.25 per $1,000 of the sale price but varies by company.

Recording and Transfer Fees:
These are fees charged by the county to record the new ownership and transfer the deed. The amount varies by county but is generally a few hundred dollars.

Attorney Fees:
While not mandatory in every county, many Mississippi sellers hire a real estate attorney to review contracts and handle closing paperwork. Attorney fees depend on services but expect anywhere from $500 to $1,500.

• Home Warranty or Repair Costs:
  Sometimes sellers agree to provide a home warranty or cover certain repair costs discovered during inspection as part of the sale terms.

How Sellers Can Reduce Closing Costs:

• Negotiate Commission Rates: Discuss options with your agent for reduced or tiered commissions.
• Use Flat-Fee MLS Services: These allow you to list your home on the MLS for a fixed fee, reducing agent commissions significantly.
• Shop for Title Companies: Rates vary, so comparing providers can save money on title insurance and closing fees.
• Prepare Your Home: Address repairs early to avoid costly concessions or delays during closing.

Why Understanding Seller Costs Matters

Being clear on closing costs helps sellers price their homes competitively while factoring in net proceeds. It also empowers you to negotiate terms effectively and avoid last-minute surprises that could impact your sale.

How Closing Costs Are Paid in Mississippi

In Mississippi, both buyers and sellers share the responsibility for closing costs, but who pays what can vary based on local customs and negotiations. Sellers often pay the agent commissions and title insurance, while buyers usually cover loan-related fees and inspections.

That said, it’s common for some costs to be negotiated during the sale. For example, in a buyer’s market, sellers may agree to cover part of the buyer’s closing costs as an incentive. Always discuss these details early with your real estate partner to avoid surprises.

Tools to Estimate Closing Costs

Estimating closing costs can feel overwhelming, but several reliable online calculators can help you get a clearer picture:

• Houzeo’s Buyer Closing Cost Calculator: Tailored for Mississippi buyers, this tool breaks down typical fees you can expect.
• Clever’s Seller Closing Cost Calculator: Designed for sellers, it estimates costs based on home price and local data.
• Bank of America’s Closing Costs Calculator: A comprehensive calculator for buyers and sellers, offering personalized estimates.

Using these tools can help you budget more accurately and plan for your transaction with confidence.

Tips to Lower Your Closing Costs in Mississippi

There are ways to keep your closing costs under control:

• Negotiate Agent Commissions: Ask your agent if they offer reduced commission rates or consider flat-fee MLS services.
• Shop Around for Lenders: Different lenders have varying fees and rates, so comparing offers can save money.
• Ask for Seller Concessions: Depending on market conditions, you might negotiate for the seller to cover some of your closing costs.
• Look Into Assistance Programs: Mississippi offers first-time homebuyer programs that can help with down payments and closing costs.

Conclusion

So, how much are closing costs in Mississippi? Closing costs in the Magnolia State vary depending on whether you’re buying or selling, the price of the home, and the specifics of your transaction. Planning ahead and understanding these fees can help you avoid surprises and make smarter financial decisions.

If you’re ready to dive into Mississippi’s real estate market but want expert guidance, SOLD.com can connect you with trusted agents and partners who understand your local market and can help you navigate closing costs smoothly. 

Take our Quiz to match with a SOLD.com real estate expert!

Common Questions About Closing Costs

Do closing costs vary by county?
Yes, some fees like recording and transfer taxes can differ by county, so it’s good to check with your local officials or your real estate partner.

Can closing costs be rolled into the mortgage?
Sometimes lenders allow you to finance closing costs as part of your loan, but this means paying interest on those fees over time.

Are there hidden fees to watch out for?
Always review your Closing Disclosure carefully and ask your agent or lender about any unfamiliar charges.