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Closing costs: Does your state have ultra-low mortgage fees?

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Paul Sakuma/AP/File

(Read caption) An advertisement for home mortgages is shown at a Wells Fargo Bank in Menlo Park, Calif., in July. Northern California has the nation's fourth highest combination of closing costs and title and origination fees, according to a recent survey. Can you guess which five states have the lowest charges to apply for a mortgage?

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Closing costs: They're the mortgage gotcha that you can't avoid. Whether taking out a loan to buy a new home or refinancing your current one, the process is always riddled with strange sounding fees that add up to big money.

How big? If you live in New York, it'll cost an average $5,623, according to a survey released in August. That's the highest in the nation, followed by Texas at $4,708. And it doesn't even count all those other fees for processing by various local government officials and escrow fees.

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But where can you get the lowest origination and closing costs? These five states stand out:

5. Wisconsin – $3,303

The Badger State has average origination fees, but low closing and title costs of $1,812. That's a third of what New Yorkers get charged.

4. Montana $3,298

Montanans buying or refinancing a home get a great deal on origination fees of $1,409. That's not quite as good as Florida's $1,237, but its closing and title costs are nearly $900 cheaper, which makes Montana a great place to get a mortgage.

3. Iowa $3,261

Iowa's high rating comes entirely from low closing and title costs. At $1,784, they're the lowest in the nation except for the following two states.

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2. North Carolina $3,255

Lenders in the Tar Heel state shave $6 off Iowa's costs to grab the No. 2 spot.

1. Arkansas $3,007

Rated the 17th most expensive state for closing and origination costs last year, Arkansas has come a long way in 2010 to take top honors in the survey. With average origination fees and $1,542 in closing and origination costs, Arkansans spend nearly $250 less to take out a mortgage than anywhere else in the US.