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Academy Mortgage continues to answer home buyer’s top 10 questions about mortgages in this week’s edition of Mortgage Minutes. While many builders offer incentives that can be used towards closing costs, many buyers are unsure of what those costs are and whether or not they’ll be required to pay them.

Closing costs consist of all the different fees and charges that must be paid when you obtain a loan. These charges often include fees for the attorney and the appraiser, taxes and fees owed to the state of Georgia, and lender fees. All of these items have to be paid at the time of closing, although the home buyer is not always responsible for them.

Closing costs can be paid by the seller if it is negotiated into the sales agreement, and the seller can pay up to a certain percentage depending on your loan type. With many loans, the seller is able to pay as much as three percent of the purchase price towards closing costs.

Having the lender pay the closing costs is also an option. The lender will often charge a slightly higher interest rate or finance the costs into the loan if they cover the costs on closing day.