Closing Costs in Louisiana: A Buyers and Sellers Guide for 2024

Closing costs in Louisiana for buyers are typically 2% to 5% of the purchase price, while sellers pay around 8% to 10% of the sales price. However, the exact percentage varies greatly depending on factors like the home value, loan type, and location. Read on to learn all about closing costs in Louisiana.

Key Takeaways

  • Closing costs for buyers in Louisiana range from 2% to 5% of the purchase price.
  • Sellers pay around 8% to 10% of the sales price in closing costs.
  • Main factors that impact closing costs include the home value, loan type, and location.
  • Buyers typically pay for the appraisal, credit report, origination fees, and more.
  • Sellers cover transfer taxes, broker commissions, title insurance, legal fees, and other costs.
  • Closing usually takes 30-45 days after the sales contract is signed.

What are Closing Costs in Louisiana

Closing costs refer to various administrative fees charged to both the home buyer and seller during the real estate transaction. They are paid at closing when the property sale is finalized.

These costs cover professional services, taxes, insurance, legal fees, and more to process, validate, and close the home sale. Both buyers and sellers will have closing costs to pay, though the specific fees vary between the parties.

Also read: Closing Costs in Oregon: A Ultimate Guide for Home Buyers and Sellers

Different Types of Closing Costs

The main types of closing costs in Louisiana include:

For Buyers

  • Appraisal fee
  • Credit report fee
  • Origination and underwriting fees
  • Discount points
  • Home inspection fees
  • Homeowner’s insurance
  • Interest payments
  • Property taxes
  • Title insurance policy

For Sellers

  • Agent commissions
  • Capital gains taxes
  • Legal fees
  • Title insurance policy for buyer
  • Local transfer taxes
  • State tax stamps
  • Payoff of seller’s existing mortgage
  • Any unpaid homeowners association dues

The exact closing costs you’ll pay depends on if you are the buyer or seller, along with other influencing factors.

Factors Influencing Closing Costs in Louisiana

Several factors can influence closing costs in Louisiana, and it’s important to be aware of them before buying a home in the state. Here’s a quick summary:

  • Sale price: The higher the sale price, the higher the closing costs will generally be.
  • Loan type: Different loan types have different associated fees. For example, government-backed loans like FHA or VA loans typically have higher closing costs than conventional loans.
  • Credit score: Borrowers with lower credit scores may be charged higher fees by lenders.
  • Location: Closing costs can vary slightly depending on the specific location of the property.
  • Negotiations: In some cases, buyers may be able to negotiate with the seller to cover some or all of their closing costs.

Also read: Oklahoma Home Buyer and Seller Closing Costs

Who Pays Closing Costs in Louisiana

In Louisiana, buyers traditionally pay their own closing fees, while the seller pays their closing costs including agent commissions. However, the purchase agreement dictates who pays which fees.

Buyers often pay appraisal, credit check, origination, underwriting, home inspection, taxes, insurance, title insurance, and more. Of course, there are some exceptions depending on negotiations.

Meanwhile, sellers commonly cover agent commissions, capital gains taxes, legal services, title insurance for buyers, transfer taxes, mortgage payoffs, unpaid dues, and additional costs related to selling the home.

Who Pays Closing Costs on FSBO in Louisiana

With For Sale By Owner (FSBO) home sales in Louisiana with no agents involved, the buyer takes on additional closing costs.

For FSBO sales, buyers pay the full title insurance premiums and may also cover appraisal, credit check, and other standard seller fees. FSBO sellers avoid paying agent commissions, so buyers take on additional closing costs.

Ultimately, FSBO closing costs still depend on the negotiated contract terms between the buyer and seller. But in general, buyers can expect to pay higher closing fees than they would with an agent-listed property.

Also read: Closing Costs in Michigan: What Homebuyers Need to Know

How Much are Closing Costs in Louisiana

On average in Louisiana, closing cost fees for buyers fall between 2% to 5% of the purchase price. So on a $200,000 home, a buyer may pay $4,000 to $10,000 in closing costs.

Meanwhile, the typical seller pays 8% to 10% of the home’s sale price – so around $16,000 to $20,000 on a $200,000 sale.

According to ClosingCorp the average closing cost for a buyer in Louisiana is 1.7% of the total purchase price.

To calculate your closing costs in Louisiana, expect to pay:

Home PriceBuyer Closing CostsBuyer Closing Costs
$100,000$2,000.00 – $5,000.00$8,000.00 – $10,000.00
$200,000$4,000.00 – $10,000.00$16,000.00 – $20,000.00
$300,000$6,000.00 – $15,000.00$24,000.00 – $30,000.00
$400,000$8,000.00 – $20,000.00$32,000.00 – $40,000.00
$500,000$10,000.00 – $25,000.00$40,000.00 – $50,000.00
$750,000$15,000.00 – $37,500.00$60,000.00 – $75,000.00
$1,000,000$20,000.00 – $50,000.00$80,000.00 – $100,000.00

How Much are Closing Costs for Buyers in Louisiana

For home buyers in Louisiana, you can plan on paying between 2% to 5% of the property’s purchase price in closing costs. With lower-priced homes, closing costs tend to fall near the higher end of that range as a percentage.

On a $250,000 home purchase, a Louisiana buyer may pay around $5,000 to $12,500 or more in total closing fees. Some typical closing costs for buyers include:

  • Appraisal: $400 – $800
  • Credit Report: $20 – $75
  • Origination & Underwriting: 1% – 2% of loan amount
  • Home Inspection: $300 – $500
  • Home Insurance Premium: Varies greatly
  • Title Insurance Policy: $700 – $2,000
  • Property Taxes: Prorated based on close of escrow
  • Interest Payments: Daily interest from date of closing

Closing processes also include document or processing fees, application fees, and more. Get quotes from multiple lenders to estimate accurate buyer closing costs.

How Much are Closing Costs for Seller in Louisiana

For Louisiana home sellers, plan on paying approximately 8% to 10% of the home’s sale price in closing fees. Actual percentages vary depending on home value, agents used, taxes owed, and other factors.

On a $350,000 home sale, the seller would pay around $28,000 to $35,000 in closing costs. Some typical fees for sellers include:

  • Agent Commissions: 5% – 6% of sale price
  • Transfer Taxes: $3 – $8 per $1,000 of sale price
  • Legal Fees: $400+
  • Title Insurance for Buyer: $700 – $2,000
  • Payoff Existing Mortgage: Loan amount + any penalties
  • Unpaid HOA Dues: Varies

Capital gains taxes, document fees, and other costs may also apply for real estate sellers at closing.

What is the average closing time on a house in Louisiana?

In Louisiana, it takes approximately 30 to 45 days on average to close on a house after the sales contract is signed.

However, closing timelines can vary substantially based on factors like:

  • Financing type – Cash and conventional loans close fastest
  • Purchase agreement – Contingencies may extend timelines
  • Escrow workflow – Title and lender workload impacts speed
  • Appraisal/inspection timing – Delays push back closing

Ensure you account for at least 30-45 days for closing when considering a home purchase in Louisiana. Communicate time expectations early when negotiating the offer terms.

How are Closing Costs Calculated

Closing costs are calculated based on set fees charged by specific service providers, percentage-based fees related to sale prices, prepaid costs for items like insurance and taxes, and some costs split between parties.

For example:

  • Appraisal fee – Based on the appraiser’s set rate
  • Origination fee – Charged as 1% to 2% of the total loan amount
  • Transfer taxes – Calculates as $3 to $8 per $1,000 of sale price
  • Title insurance – Depends on home value and policy type
  • Prepaid taxes – Prorated for remaining days based on close of escrow

Get a detailed closing cost worksheet from lenders and agents to understand exactly how all fees are calculated. This helps avoid surprise charges at closing time.

Steps to Prepare for Closing

To ensure a smooth closing in Louisiana, follow these key steps:

  • Review your Loan Estimate and title paperwork – Look for any surprise fees early.
  • Get pre-approved if buying – Speeds up the closing process.
  • Verify homeowners insurance requirements – Avoid delays coordinating this.
  • Complete your final walkthrough inspection – Confirms repairs were completed properly.
  • Review documents carefully at closing – Don’t feel rushed to sign.
  • Bring proper payment and identification to closing – Includes processing delays.

Understanding what to expect, reviewing all documentation early, and communicating with professionals throughout the process allows for an organized, efficient closing.

Ways to Reduce Closing Costs in Louisiana

Strategies to lower Louisiana closing costs

  • Negotiate seller contributions
  • Shop lender & title rates
  • Increase downpayment
  • Secure lender discounts
  • Buydown interest rate
  • Extend closing timeline

Every bit helps trim expenses for buyers and sellers alike.

How to Avoid Paying Closing Costs When Buying a House

It’s rare to completely avoid closing costs as Louisiana home buyer but a few tips:

  • Ask for seller concessions to pay fees
  • Get lender credits trading higher rate
  • Negotiate agent commissions
  • Check first-time buyer grants
  • Time offer during low demand

Requires lucky timing and tactical negotiating!

How to Find a Trusted Real Estate Agent

A knowledgeable, experienced real estate agent guides you through the closing process while also negotiating the best deal. Here are tips for finding an excellent agent in Louisiana:

  • Ask friends/family for referrals – Prior happy clients indicate good agents.
  • Search online reviews and ratings – Reputation demonstrates quality.
  • Interview multiple agents – Ensure your personalities fit well.
  • Ask about experience with local markets and closings – An expert agent minimizes hiccups.
  • Compare listed sales prices to final sale prices – Helps assess negotiation strengths.

Taking time to research and vet agents leads to the best representation on closing day. The right real estate professional truly pays for themselves by optimizing the terms and pricing for clients.

Conclusion

In closing, buyers in Louisiana need to budget approximately 2% to 5% of the total purchase price for closing fees, while sellers typically pay around 8% to 10% of the final sales amount. Exact closing costs vary based on the home’s value, financing, location, taxes, credits, and other factors.

Working with experienced real estate and lending professionals allows buyers and sellers to minimize closing costs as much as possible while ensuring no surprise charges. Comparing multiple quotes along with researching ways to negotiate credits potentially reduces overall closing fees.

Factor in ample time and financial planning for closing expenditures when buying or selling Louisiana real estate. Budget conservatively until final disclosures get prepared near the close of escrow date. Following tips in this guide sets up both buyers and sellers for closing success.

Frequently Asked Questions (FAQ)

Who pays most closing costs?

In most real estate transactions, sellers typically pay more in closing costs than buyers, although both parties are responsible for certain fees. This is because sellers often cover real estate agent commissions, which can be a significant portion of the total closing costs. However, the specific division of costs can be negotiated in the purchase agreement.

Who pays property taxes at closing in Louisiana?

In Louisiana, property taxes are prorated at closing, meaning they are divided between the buyer and seller based on the number of days each party will own the property during the current tax year. The seller is responsible for paying the portion of taxes that accrued up to the closing date, while the buyer is responsible for the remaining portion.

Who pays title fees in Louisiana?

In Louisiana, the buyer typically pays for owner’s title insurance, while the seller pays for lender’s title insurance. However, specific agreements can be made between the buyer and seller regarding who pays for which title insurance policy.

Which state has the highest average closing costs?

According to available data, states with high property taxes and a strong seller’s market tend to have higher average closing costs. However, it’s crucial to remember that closing costs can vary greatly depending on several factors, including the purchase price of the home, loan type, location, and negotiated terms. It’s best to consult with a real estate professional or closing agent for a more accurate estimate of closing costs in your specific situation.

What are the typical closing costs in Louisiana?

For buyers, closing costs range from 2%-5% of the purchase price. Sellers pay around 6-10% of the sale price. On a $200,000 home, buyers pay around $4,000-$10,000 and sellers pay $12,000-$20,000.

What closing costs do buyers pay in Louisiana?

Common buyer fees include appraisal, credit check, origination, underwriting, home inspection, taxes, insurance, title insurance, and more. Exact costs depend on loan type, home price, and other factors.

What do sellers pay for closing costs in Louisiana?

Sellers commonly cover agent commissions, capital gains taxes, legal services, title insurance for buyers, transfer taxes, mortgage payoffs, unpaid HOA dues, and fees directly related to selling the home.

How can I reduce closing costs in Louisiana?

Compare lenders for lower rates, negotiate who pays specific fees, ask about seller/lender credits, buy down interest rates, exclude escrow accounts, file for homestead exemption, and work with experienced real estate/lending professionals.

How much are refinance closing costs in Louisiana?

Expect to pay 2-6% of the total loan amount. On a $200,000 refinance, that’s $4,000-$12,000 on average. Shop and compare quotes from multiple lenders.

Razib

Razib is a skilled writer with 5 years of experience specializing in technology, finance, automotive and real estate. A BBA graduate from 2014, Razib's passion for these industries shines through in his informative and engaging content. His ability to break down complex topics and stay current on the latest trends makes him a valuable resource for readers seeking to understand these dynamic fields.

Related Articles