Closing costs are the fees and expenses you pay to finalize your mortgage — beyond the down payment. They typically range from 2-5% of the loan amount and include lender fees, third-party services, and prepaid items. You'll receive a Loan Estimate within 3 days of applying and a Closing Disclosure 3 days before closing, both of which itemize every cost.
| Cost Category | Typical Amount | Negotiable? |
|---|---|---|
| Loan Origination Fee | 0.5-1% of loan amount ($1,500-$3,000 on $300k) | ✅ Yes |
| Appraisal Fee | $400-$600 | Sometimes |
| Title Insurance (Lender's) | $500-$1,000 | Shop around |
| Title Insurance (Owner's - optional) | $500-$1,000 | ✅ Yes (optional) |
| Credit Report | $25-$50 | No |
| Home Inspection | $300-$600 | Shop around |
| Recording Fees | $100-$500 | No (government-set) |
| Attorney Fees | $500-$1,500 (if required in your state) | Shop around |
| Prepaid Property Taxes | 2-6 months (varies by closing date) | No |
| Prepaid Homeowners Insurance | 1 year upfront ($1,000-$2,500) | Shop around |
| Escrow/Impound Reserves | 2-3 months of taxes + insurance | No |
Origination fees, underwriting fees, and application fees are often negotiable. Ask the lender to waive or reduce them — especially if you have strong credit.
Ask the seller to pay some or all closing costs. Conventional: up to 3-9% of purchase price. FHA: up to 6%. VA: up to 4% plus reasonable costs.
Accept a slightly higher rate (0.125-0.25% higher) in exchange for the lender paying your closing costs. Good if you'll sell/refi soon.
The lender pays closing costs in exchange for a higher rate. Common on refinances. Makes sense for short-term homeowners.
You can choose your own title company, home inspector, and insurance provider. Compare 2-3 providers for each — savings can be significant.