Refinance costs in 2021 were less than 1% of loan closing costs. That was well below purchase closing costs.
The second annual CoreLogic Refinance Closing Cost report says the national average closing costs for a single-family property refinance in 2021, excluding any type of recordation or other specialty tax, was $2,375. That was up $88, or 3.8%, from 2020. The average refinance loan amount was $304,909 in 2021.
“In 2021, homeowners were still able to get good deals on both interest rates and closing costs,” Bob Jennings, executive, CoreLogic Underwriting Solutions, said. “While refinance closing costs increased marginally, annual increases in fees still remain below the 7% average rate of inflation seen in 2021. Much of the cost control can be attributed to growing use of technology solutions by both lenders and settlement services providers, which enabled the industry to scale up capacity while holding the line on closing costs.” CoreLogic, a provider of residential real estate closing cost data and technology for the mortgage and real estate services industries, said the national average for purchase closing costs was $3,860, excluding transfer and specialty taxes. That was a 13.4% increase from 2020.
The major differences between average closing costs for refinances versus home purchases is that owner title insurance and several inspection fees common for purchase transactions are not typically required for refinances, according to CoreLogic. Still, most third-party fees, including lender title, settlement service and land surveys, were also lower for refinances.
The 2021 report shows the states with the highest average closing costs, excluding specialty taxes, were Hawaii ($4,730), New York ($4,679), Florida ($3,956), Texas ($3,588) and District of Columbia ($3,370).
The states with the highest closing costs, including taxes, were New York ($10,084), Pennsylvania ($7,614), Delaware ($7,223), Florida ($5,821) and California ($5,762).
At the metro level, those with the highest average fees without taxes include Key West, Florida ($4,922); Arcadia, Florida ($4,756) and Kahului-Wailuku-Lahaina, Hawaii ($4,651).
Refinance cost calculations include lender’s title policy, appraisal, settlement, recording fees and various state and local taxes. Calculations use home price data from CoreLogic to estimate closing costs for an average home at the state, core-based statistical area (CBSA) and county levels. Ranges, rather than single values, are used to more accurately capture fees associated with the real transactions.
