Closing costs: every fee you might see

What closing costs are, how much buyers typically pay, a plain-English glossary of each fee, and how to lower them.

How much are closing costs?

LodeStar’s analysis of 620,000+ 2025 purchase quotes found national average buyer closing costs of $4,528, about 1.04% of the sale price (median $3,492), including title, settlement, recording, and transfer taxes but not lender fees, prepaids, or escrow deposits. By state it ranged from about 0.5% to 3% (Delaware highest at 3.06%).
Once lender fees, prepaid interest, insurance, and escrow deposits are added, the total cash needed is higher; Rocket Mortgage cites a typical 3%–6% of the loan amount or price. Your Loan Estimate shows your actual estimate.
Transfer and mortgage taxes vary dramatically by state and even city—some states have none.

The Loan Estimate and Closing Disclosure

Lenders must give you a Loan Estimate within 3 business days of your application. Get one from several lenders and compare Section A and the total.
You must receive the Closing Disclosure at least 3 business days before closing. Compare it to your Loan Estimate and ask about any changes.

Fee glossary (by Loan Estimate section)

A. Origination charges (lender)

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Application / origination fee	Lender’s charge for making the loan, sometimes a % of the loan.	Buyer	No sourced national figure; see your Loan Estimate	Compare lenders; often negotiable
Underwriting / processing fee	Reviewing and preparing your file.	Buyer	No sourced national figure; see your Loan Estimate	Negotiable; some lenders waive
Discount points	Optional upfront payment to lower your rate; 1 point = 1% of the loan.	Buyer (seller can credit)	1% of loan per point	Optional; compare break-even
Rate lock / extension fee	Holds a rate; extensions if closing is delayed.	Buyer	No sourced national figure; see your Loan Estimate	Ask before locking

B. Services you cannot shop for

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Appraisal / re-inspection	Professional estimate of value; re-inspection confirms required repairs.	Buyer	VA caps: about $700–$1,500+ by area (May 2026 schedule); others on Loan Estimate	Lender chooses appraiser
Credit report	Pulling your credit.	Buyer	No sourced national figure; see your Loan Estimate	No
Flood certification	Checks whether the home is in a flood zone.	Buyer	No sourced national figure; see your Loan Estimate	No
Tax service fee	Lets the lender track property-tax payments.	Buyer	No sourced national figure; see your Loan Estimate	Sometimes waived
Upfront mortgage insurance / guarantee	FHA upfront MIP 1.75%; VA funding fee 2.15% first use with under 5% down (1.5% at 5%+, 1.25% at 10%+, 3.3% subsequent use under 5%); USDA guarantee fee 1% (FY2026).	Buyer (often financed into the loan)	See left	Set by program; VA exempts many disabled veterans

C. Services you can shop for

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Title search / exam	Checks public records for liens and ownership problems.	Buyer (varies by state)	Included in LodeStar average above	Yes — shop title/settlement providers
Lender’s title insurance	Protects the lender against title defects. Required.	Buyer	Included in LodeStar average	Shop
Owner’s title insurance	Protects you; optional but recommended. Shown in Section H. In some areas the seller pays.	Varies by local custom	Included in LodeStar average	Shop; negotiate who pays
Endorsements	Add-on title coverages.	Buyer	No sourced national figure; see your Loan Estimate	Shop
Settlement / closing / escrow fee	Company or attorney that runs the closing.	Buyer and/or seller (local custom)	Included in LodeStar average	Shop
Attorney fee	Required in some states for closing.	Varies	No sourced national figure; see your Loan Estimate	Shop
Survey	Confirms property lines; required in some areas.	Buyer	No sourced national figure; see your Loan Estimate	Shop
Pest inspection	Wood-destroying insect report if required.	Buyer (VA allows when required)	$125–$450 (Angi)	Shop
Notary, courier, wire fees	Small administrative charges.	Buyer	No sourced national figure; see your Loan Estimate	Ask to waive

E. Taxes and other government fees

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Recording fees	County fee to record the deed and mortgage.	Buyer (usually)	Set by county	No
Transfer / mortgage taxes	State/local tax on the sale or mortgage. Amount and who pays vary by state; some have none.	Varies by state/local custom	Set by law	No (who pays is negotiable)

F. Prepaids

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Homeowners insurance (first year)	Required by lenders.	Buyer	Quote from insurer	Shop insurers
Flood insurance	Required in high-risk flood zones with a federally backed loan.	Buyer	Quote	Shop
Prepaid interest	Interest from closing day to month end.	Buyer	Depends on closing date	Closing date choice
Property taxes	Any taxes due at closing.	Buyer / prorated with seller	Set by locality	No

G. Initial escrow payment at closing

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Escrow deposit & cushion	Starting balance for future taxes and insurance; federal rules allow a cushion of up to 2 months.	Buyer	Depends on taxes/insurance	No

H. Other

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
HOA transfer, estoppel, capital contribution	Association fees when ownership changes.	Varies by HOA/contract	No sourced national figure; see your Loan Estimate	Negotiable between buyer and seller
Home warranty	Optional service plan.	Buyer or seller	Quote	Optional
Home inspection	Your own inspection.	Buyer	$296–$425 general (Angi)	Shop
Annual mortgage insurance	PMI (conventional, under 20% down); FHA annual MIP (0.55% for most loans); USDA annual fee 0.35%. Paid monthly.	Buyer	See left	PMI can be removed later (CFPB)

Seller-side costs

Fee	What it is	Who usually pays	Typical cost (if sourced)	Shop / negotiate?
Real estate commission	Since 2024 changes following the NAR settlement, commissions are negotiable and buyer-agent pay is agreed in writing; it is not set by law.	Negotiated	Negotiable	Yes
Transfer tax (seller share)	Where local custom puts it on the seller.	Seller (varies)	Set by law	Who pays negotiable
Owner’s title policy	Seller pays in some markets.	Varies	—	Negotiable
Mortgage payoff & reconveyance/release fee	Pays off the existing loan and records its release.	Seller	Per lender/county	No
Seller concessions	Seller credits toward buyer costs; loan programs cap how much.	Seller	Negotiated	Yes

How to lower your closing costs

Get Loan Estimates from at least 3 lenders on the same day and compare.
Shop title, settlement, and survey providers (Section C).
Negotiate seller credits as part of your offer.
Ask about lender credits (a slightly higher rate in exchange for lower costs).
Look into state/local down payment and closing cost assistance programs.
Choose a closing date late in the month to reduce prepaid interest (but it doesn’t change your total interest over the loan much).

Still have questions?

Our Closing agent can explain your Loan Estimate line by line.

Ask the agent →

Sources

Disclaimer: This page is general educational information, not financial, legal, tax, or real estate advice. Program rules, fees, and limits change, and lenders, title companies, and inspectors set their own requirements and prices (lender “overlays”). Figures are national or program-level and vary by state, county, property, and lender. Confirm details with a licensed lender, attorney, or other professional before you decide. Last reviewed October 15, 2026.