What are fees associated with a mortgage often referred to as?

Closing costs are fees associated with a mortgage that are incurred during the final stages of the home-buying process. They represent various charges that buyers need to pay to finalize the mortgage and the transfer of property. Closing costs can include a variety of expenses such as loan origination fees, title insurance, appraisal fees, and various recording fees. These costs are typically paid at the time of closing, which is when ownership of the property is officially transferred to the buyer.

The other options refer to different aspects of a mortgage transaction. Down payments are the initial amount a buyer pays upfront when purchasing a property and are usually expressed as a percentage of the home's purchase price. Interest rates represent the cost of borrowing money from the lender, typically expressed as an annual percentage of the loan amount. Principal payments refer to the portion of the monthly mortgage payment that goes toward reducing the original loan balance. Understanding these terms helps provide clarity on the overall costs and structure of a mortgage.