Buying a house? One of the things you may not be prepared to pay for are the closing costs. These are the costs above and beyond the interest of your loan, and they are for fees and services paid for when a home is sold. That said, there are ways to reduce how much you pay in closing costs that can help make your home purchase more affordable. Here is what you need to know to save some money at closing.

Understand The Costs That Can't Be Reduced

It helps to understand what costs you cannot do anything about to lower. This will save you the time with trying to negotiate with your bank on items that won't change no matter how many time you ask. This includes the origination fees for the loan, appraisal costs, and the credit report charge.

Of course, if you are making a cash offer on the home for sale, all of these costs will not need to be paid, but very few people have the luxury of buying a home without any financing at all.

Understand The Costs That Can Be Controlled

There are several costs when closing on a home that you do have control over.

Home Inspection

While the home inspection is optional, it is still a good idea to have it done. You do have complete control over who you pick to do the home inspection. You can save some money by skipping things like infrared scanning of the insulation, and focus just on the essential things that you want looked at.

Home Warranty

The seller may be offering you a home warranty, which is a service plan that will repair or replace the appliances in your home if they were to break. Instead of taking the home warranty, ask the seller if you can take the cash value of the warranty. This will typically be paid to you at closing, as a credit towards the total closing costs that you owe.

Agent Commission

Real estate agent commission is usually based off the sales price of the home as a specific percentage, usually around 2% and 2.5%. This percentage is completely negotiable, with a more expensive home having a bigger commission than a cheaper home. You may be able to get the commission lowered if an agent is trying to get your business, since the alternative for them would be not making a sale at all.