Real Estate Closing Costs in Oakland, CA
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Real Estate Closing Costs in Oakland, CA

Owning a home is the dream for every individual and household. Consequently, you might have done considerable research into the neighborhood and the possible asking price from sellers in the area. But have you looked into how much you are going to pay in terms of closing costs?

The East Bay Realty Bay Group has compiled this article to unpack this information for any potential California homeowner.

What are closing costs?

Closing costs can be explained as the expenses, incurred either by the buyer or seller of a property that is above the property’s selling price. Taking into consideration varying factors, parties involved can pay up to 15% of the selling price in closing costs.

Several factors will determine the number of closing costs that you will pay. Some of the factors include the selling price of the property, the location (neighborhood and State), and the entities involved.

In our experience, what makes closing costs such a burden is the timing. As the name implies, closing costs kick in at the final stage of the purchasing process. At this point, money will have exchanged hands, the sale agreement will have been signed and transferred to the buyer. Both parties are bound to meet the obligations and pay for the closing costs.

If you are a buyer or seller looking to purchase property in Oakland, California, this article is just right for you.  

Allocation of closing costs

Allocation of closing costs

It is a common misconception that all closing costs are paid by the buyer. In a typical home purchase, other costs are paid by the seller. Furthermore, you can negotiate with the seller to contribute more towards the total sum of the costs.

In this section, we will be looking into who has to pay for what.

Below are some of the closing costs that are the responsibility of the buyer:

  1. Attorney fees. Due to the legal nature of the property, it is expected to involve an attorney in the purchase.
  2. Credit Report fees. If you are looking for a mortgage, the lender will charge you for credit checks.
  3. Loan Origination Fees. This is charged for the processing of your loan paperwork.
  4. Home Inspection fees. To ensure the security of the loan, most lenders will require a home inspector to perform a comprehensive inspection of the property.
  5. Appraisal fees. An appraiser will be called upon to verify that the asking price is justified, taking into account economic, locational factors, and other value drivers.
  6. Title Search fees. A background check confirms that there are no unpaid liens against the property.
  7. Homeowner’s insurance. This is a requirement by your lender. It will cover any damage to your home from the various risks. The insurer may request that you take extra policies to protect your home from the different natural disasters in California.

The following closing costs fall under the seller’s jurisdiction:

  • Real estate commission fees. The seller is expected for this. It is usually charged at 6% of the purchase price.
  • Transfer fees. Local governments impose fees to facilitate the transfer of title to the new owner.
  • Home warranty premiums. This is to offer the buyers some peace of mind. The typical length of the warranty is a year.
  • Title insurance premiums. This serves as insurance if there are issues with the title after the title search.
The importance of a local Oakland CA Real Estate Agent

Tips on how to reduce or avoid closing costs

The addition of the closing costs to the final price may make affording your new home more difficult. Imagine months of saving for the down payment, searching for the perfect property for your family, and negotiating the final price down the drain.

Though inevitable, here are some tips that you can consider to reduce your expenses:

How good are your negotiation skills? Negotiation is a critical part of any home purchasing process. However, homeowners only consider the asking price of the property as a viable negotiation topic. They forget that virtually every item is a negotiable item, including the closing costs of the property.

The seller will be willing to agree to contribute to the closing costs if you put forward an attractive offer. A proven method is to offer a quick close on the property. However, this move would require that you have substantial savings to cover the balance.

From our experience in the Oakland property market, homeowners can significantly reduce closing costs by performing considerable due diligence on the mortgaging of the property. Approach several banks and request their loan estimate forms. Peruse their loan requirements by looking into the finer details of the loan. Keep an eye out for discounts, rebates, and ‘no-closing costs’ requirements.

If you can pay cash for your home, you will be able to significantly lower the closing costs. You will be able to eliminate loan origination as well as appraisal fees.

Another proven alternative to mortgage is seller financing. As the name suggests, the seller will be acting as the bank. Similar to a mortgage setup, the buyer will pay off the loan over a given period. Seller financing comes with several advantages.

You might not have to pay for loan origination fees, appraisal fees, and survey fees. Buyers might be able to skip home inspections as well. We would not however recommend this. As a buyer, you should know the exact condition of your property before you close. 

You must have heard about the 20% rule down payment rule when it comes to property purchases and mortgages. This is because of the issue of mortgage insurance. Conventionally, the bank doesn’t require a mortgage insurance if you make a 20% down payment. If you are unable to meet this threshold, you will have to pay for this insurance.  

The importance of a local Oakland CA Real Estate Agent

While we might have outlined several strategies for reducing the closing costs, closing costs in Oakland can still eat up a significant portion of your savings. The strategies outlined still need an experienced eye and expert skills in the local market.



Are you looking to purchase property in Oakland, California? Searching for the ideal neighborhood with specific needs in mind? You are going to need local expertise with knowledge and experience in the area. There is no better company than the experts at East Bay Realty Group.

Our experienced team is looking forward to helping you on your real estate journey. With our years of experience in the Oakland property market, we are the experts to call upon.

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