Understanding Closing Costs

[Alex Furness]

Hi everyone,

First time house hacker & brand new to RE Investing here! Looking to purchase my first duplex in the greater Philly area over the next 6 months or so. I've started seeing some properties and also received a few loan estimates from different lenders.

I'm looking at FHA loans for financing and was a bit surprised at some of the closing costs (40k total cash to close), wanted to ensure these were normal?

For instance, looking at one of the estimates for a $400k purchase price, here are a few of the line items:

Total PITI: $2,624 per month

2.75% interest

Transfer taxes: $17k

Lender's Title Insurance: $2,712

Mortgage Insurance Premium: $6,755

Appraisal Fee: $770

Homeowners Insurance Premium: $3,000

There are just a few of the bigger ones.. I was expecting the $14k down payment but while I am in a good financial situation the total cash to close seems a bit high to make financial sense. My objective overall was to reduce my monthly "rent" (Income-expenses) to somewhere around the $500-$700 dollar mark. 

Are all these costs normal or are there ways around this, perhaps talking to other lenders? Any input is greatly appreciated!