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D.C. has fifth lowest average closing costs in nation

By WTOP Staff

Sophie Ho, special to wtop.com

WASHINGTON — D.C. may be one of the most expensive U.S. cities in which to live, but a new report by personal finance website Bankrate shows the District has the fifth lowest mortgage closing costs.

In the report, Bankrate requested good faith estimates for a $200,000 mortgage loan from up to 10 lenders in each state and D.C., with a hypothetical 20 percent down payment and good credit.

Closing costs are charged by lenders and third parties when a consumer gets a mortgage, such as fees to process credit card reports, inspection costs, underwriting fees or appraisal fees.

In general, the website found that mortgage closing costs jumped 6 percent over the past year, and now average at $2,539 on a $200,000 loan. D.C. ranked fifth lowest at $2,402.

Texas ranked first with the highest average closing costs at $3,406, while Nevada was the cheapest at $2,265.

But buyers should beware that their closing costs would likely be higher in real life. Not included in the report were title insurance, title search, taxes, other government fees or escrow fees.

Even more, the Office of the Chief Financial Officer predicted that the average sales price of a District home will hit $769,800 in 2014 — jumping to $813,600 in 2015. Currently, median single family home price in D.C. is around $600,000, while the average price is $713,000.

The full list is below.

Closing costs
2014
rank		 State Lender’s
origination fees		 Third-party
fees		 Origination plus
third- party fees
1 Texas $2,280 $766 $3,046
2 Alaska $2,195 $703 $2,897
3 New York $2,109 $783 $2,892
4 Hawaii $2,009 $799 $2,808
5 Wisconsin $2,035 $671 $2,706
6 Nebraska $1,975 $679 $2,654
7 Vermont $1,979 $670 $2,649
8 Florida $1,982 $666 $2,648
9 New Hampshire $1,975 $666 $2,641
10 New Jersey $1,891 $733 $2,625
11 Alabama $1,967 $646 $2,613
12 North Carolina $1,887 $714 $2,602
13 North Dakota $1,936 $663 $2,599
14 Kansas $1,956 $625 $2,582
15 Louisiana $1,928 $652 $2,580
16 Rhode Island $1,931 $645 $2,576
17 Massachusetts $1,871 $693 $2,564
18 South Dakota $1,940 $623 $2,563
19 Mississippi $1,931 $629 $2,560
20 Oregon $1,896 $663 $2,559
21 Connecticut $1,885 $670 $2,555
22 California $1,881 $661 $2,542
23 Utah $1,889 $648 $2,537
24 Wyoming $1,890 $628 $2,518
25* West Virginia $1,805 $711 $2,516
25* Delaware $1,771 $745 $2,516
25* New Mexico $1,761 $755 $2,516
28 Pennsylvania $1,907 $603 $2,511
29 Oklahoma $1,908 $591 $2,498
30 Maine $1,854 $643 $2,497
31 South Carolina $1,786 $708 $2,494
32 Montana $1,796 $695 $2,491
33 Illinois $1,841 $640 $2,481
34 Virginia $1,840 $639 $2,479
35 Iowa $1,773 $675 $2,448
36* Idaho $1,800 $641 $2,440
36* Indiana $1,796 $644 $2,440
38 Minnesota $1,836 $619 $2,436
39 Colorado $1,817 $619 $2,436
40* Washington $1,830 $605 $2,435
40* Michigan $1,835 $600 $2,435
42 Georgia $1,766 $667 $2,433
43 Kentucky $1,790 $640 $2,430
44 Arizona $1,810 $615 $2,425
45 Arkansas $1,815 $605 $2,420
46 Maryland $1,836 $568 $2,404
47 District of Columbia $1,791 $612 $2,402
48 Ohio $1,707 $685 $2,392
49 Missouri $1,749 $638 $2,387
50 Tennessee $1,746 $620 $2,366
51 Nevada $1,570 $695 $2,265
         
  Average $1,877 $662 $2,539

*Denotes a tie

Bankrate.com surveyed up to 10 lenders in each state in July 2014 and obtained online good faith estimates for a $200,000 mortgage to buy a single-family home with a 20 percent down payment in the state’s largest city. Costs include fees charged by lenders, as well as third- party fees for services such as appraisals and credit reports. The survey excludes title insurance, title search, taxes, property insurance, association fees, interest and other prepaid items.

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Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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