The deed recording fee and the other costs you will see at a South Carolina closing

A different kind of transfer charge

Many states call it a transfer tax. In South Carolina it is the deed recording fee, charged for the privilege of recording a deed at the county register of deeds. The South Carolina Department of Revenue sets out the rate: $1.85 for each $500 of realty value. Of each $1.85, the county keeps $0.55 and the state receives $1.30. Dorchester County's register of deeds expresses the same rate as $2.60 to the state and $1.10 to the county per $1,000.

Working the numbers

These are simple multiplications of the published rate. Your closing attorney will compute the exact figure from the value used on the deed.

Who pays it?

The law imposes the fee on recording the deed, but it does not decide which party bears it in a private sale. That is settled by your purchase contract. Before you sign an offer, we would suggest asking your agent how the contract assigns the deed recording fee, along with the other charges discussed below.

Recording charges

Separate from the deed recording fee, counties charge to record the documents themselves. Dorchester County's posted schedule, for example, lists $15 to record a deed, $25 to record a mortgage, and $10 for a satisfaction of mortgage. Other counties set their own amounts. If your purchase includes an SC Housing second mortgage for down payment assistance, that document is recorded too.

The larger costs: lender, attorney and title

The recording items are usually modest. The bigger pieces of a South Carolina closing tend to be these:

• Lender charges. SC Housing's Homebuyer Program guide allows an origination fee of up to 1% to the lender and does not allow discount points on its loans. Expect appraisal and credit report charges as well.
• Attorney fees. South Carolina closings are supervised by a licensed attorney. Fees are not set by law. Our attorney closing guide explains what the office does and your right to choose it.
• Title insurance. Your attorney orders title insurance after reviewing the title. Ask whether an owner's policy is included or optional.
• Loan-type charges. FHA charges an upfront mortgage insurance premium of 1.75% of the base loan, which can be financed. VA loans carry a funding fee of 2.15% on first use with less than 5% down unless you are exempt. USDA's upfront guarantee fee cannot exceed 3.5% by rule.

How your loan type changes the cash you need

Your down payment is set by the loan underneath your SC Housing assistance, and it is often the largest single item. On a $250,000 home, the minimums work out as follows:

Because SC Housing requires a 640 score on all four, the lower FHA tier for weaker credit does not come into play. With a VA or USDA loan, the full $10,000 can go toward closing costs and prepaids instead of the down payment. With FHA, most of it may be absorbed by the 3.5%, leaving less for the other charges in this guide. Ask your lender to show you the cash needed under each loan type.

Prepaids and escrow

Prepaids are not fees. They are the first installments of costs you would pay anyway: usually a year of homeowners insurance, a few months of property taxes and insurance placed in escrow, and interest from closing to month's end. On the coast, flood and wind policies can make this line larger, as our coastal insurance guide explains.

Property taxes are worth special attention. Your lender may estimate them at the 6% ratio until the county records your 4% legal residence status. That may make your first escrow deposit larger than it will eventually need to be.

What SC Housing's assistance can and cannot pay

The Homebuyer Program guide describes the $10,000 assistance as a 15-year forgivable, zero percent, no-payment second mortgage that can be used for your down payment, closing costs and prepaids. It also sets some firm limits:

The guide allows cash back at closing only up to the documented amount you paid in advance, such as earnest money, the appraisal, the credit report or inspections. A principal reduction of up to one month's payment may also be applied. The program sets no minimum contribution from you unless the automated underwriting system requires one, but several local programs do. Greenville County and Richland County's RCHAP, for instance, each ask buyers to put in at least $500.

Money you spend before closing

Some costs arrive before the closing table. Budget for:

1. Earnest money with your offer, usually credited back at closing.
2. A home inspection, paid at the time of service.
3. A termite letter. Richland County's RCHAP requires a CL-100 inspection, a standard South Carolina wood-infestation report.
4. The appraisal, often collected by the lender up front.

Keep the receipts. They are what allow you to be reimbursed at closing if your assistance covers more than you need.

Reading your Closing Disclosure

At least three business days before closing, you will receive a Closing Disclosure. Compare it line by line with your Loan Estimate. Look for the deed recording fee, the recording charges, the second mortgage for your assistance and the escrow deposit. If something has moved, ask your lender and attorney before the closing day, not at the table.

To find a lender who can price your closing with SC Housing assistance, please check your eligibility.

Further questions