Settlement costs are fees paid by purchasers upon receipt of their loan from their banks.  These fees typically range from 2-7% of the total loan value. While a substantial portion of these costs is paid on the day of closing, some of these costs are paid on an earlier date.

The Real Estate Procedures Closing Act (RESPA) requires that lenders and mortgage brokers give buyers a Good Faith Estimate of all loan-related expenses due at closing. However, these estimates do not guarantee actual mortgage closing costs.