In real estate transactions, what does the term “closing costs” typically refer to?

The term "closing costs" in real estate transactions refers specifically to the various expenses that are incurred during the process of transferring property ownership from one party to another. This typically encompasses a wide range of fees that may include title insurance, appraisal fees, loan origination fees, recording fees, and attorney fees, among others.

These costs are crucial because they are part of the final steps before the ownership of the property officially changes hands. Both buyers and sellers may be responsible for certain closing costs, which can be negotiated as part of the transaction. Understanding these costs is essential for anyone involved in real estate, as they can significantly impact the overall expense of buying or selling a home.

The other options listed do not align with the typical definition of closing costs. For instance, fees related to repairs and maintenance are ongoing costs associated with property upkeep, not directly tied to the closing process. Costs related to buyer's insurance typically refer to ongoing insurance premiums and not expenses executed at closing. Charges for home staging services are also not considered closing costs; they pertain to the marketing efforts to present the home effectively during the sale process.