# Closing costs for buyers, line by line

> What buyers pay at closing, section by section on the Loan Estimate, how state transfer and mortgage taxes change the total, and ways to pay less.

URL: https://mortgage-math-us.com/buying/closing-costs/  
Last reviewed: 2026-10-28 · By the MortgageMath US Editorial team

## Quick answer

Closing costs typically run 2%–5% of the purchase price, according to the CFPB — $7,200 to $18,000 on a $360,000 home. They cover lender charges, third-party services such as the appraisal and title insurance, government recording fees and taxes, and prepaid interest, insurance and escrow deposits. State taxes make the biggest difference: on that price with 10% down, statewide transfer and mortgage taxes range from nothing in Texas to about $4,680 in New York.

## Key facts

| Fact | Value | Source | As of |
|---|---|---|---|
| Typical closing costs, low end (CFPB) | 2% | [CFPB](https://www.consumerfinance.gov/owning-a-home/prepare/figure-out-how-much-you-want-to-spend/) | Oct 28, 2026 |
| Typical closing costs, high end (CFPB) | 5% | [CFPB](https://www.consumerfinance.gov/owning-a-home/prepare/figure-out-how-much-you-want-to-spend/) | Oct 28, 2026 |
| Largest escrow cushion a lender may hold | 2 months | [CFPB, Regulation X 1024.17](https://www.consumerfinance.gov/rules-policy/regulations/1024/17/) | Oct 28, 2026 |
| Cap on increases for recording fees and lender-listed services | 10% | [CFPB](https://www.consumerfinance.gov/ask-cfpb/can-my-final-mortgage-costs-increase-from-what-was-on-my-loan-estimate-en-172/) | Sep 11, 2024 |
| Closing Disclosure arrives before closing | 3 business days | [CFPB](https://www.consumerfinance.gov/owning-a-home/closing-disclosure/) | Oct 28, 2026 |

## Closing costs on the Loan Estimate, section by section

Every lender lists closing costs on page 2 of the Loan Estimate in the same lettered sections, and the Closing Disclosure repeats them. Learn the letters once and you can compare any two offers.

*Loan Estimate page 2, “Closing Cost Details”*

| Section | What it holds | Can it change before closing? |
|---|---|---|
| A. Origination Charges | The lender’s own fees and any discount points | No increase once disclosed (points can change until you lock) |
| B. Services You Cannot Shop For | Appraisal, credit report, flood certification and other services the lender picks | No increase |
| C. Services You Can Shop For | Title services, settlement agent, survey, pest inspection | Up to 10% in total if you use the lender’s list; no limit if you choose your own provider |
| D. Total Loan Costs | A + B + C | — |
| E. Taxes and Other Government Fees | Recording fees and transfer taxes | Recording fees fall under the 10% limit; transfer taxes can’t rise |
| F. Prepaids | Homeowners insurance premium, prepaid interest, property taxes due | Can change |
| G. Initial Escrow Payment at Closing | The opening deposit for future tax and insurance bills | Can change |
| H. Other | Owner’s title insurance and items your contract assigns to you, such as HOA transfer fees | Generally can change |
| I. Total Other Costs | E + F + G + H | — |
| J. Total Closing Costs | D + I, minus lender credits | — |

The tolerance column is the short version; the [Loan Estimate and Closing Disclosure guide](https://mortgage-math-us.com/buying/loan-estimate/) explains when a lender may issue a revised estimate. Sections A and J are where offers differ most: points add to A, and lender credits reduce J — see [mortgage points](https://mortgage-math-us.com/buying/mortgage-points/).

## How much to budget

> **Worked example: $360,000 home, 10% down ($324,000 loan), 30-year fixed at the 7.24% weekly average**
>
> | Item | Estimate |
> |---|---:|
> | Closing costs at the CFPB’s 2% low end | $7,200 |
> | Closing costs at the CFPB’s 5% high end | $18,000 |
> | Of which: prepaid interest if you close mid-month (about 15 days) | $964 |
> | Of which: first-year homeowners insurance at $4.90 per $1,000 of value | $1,764 |
> | Of which: largest escrow cushion (2 months of tax and insurance) | $828 |
> | **Cash to close: 10% down plus closing costs** | **$43,200–$54,000** |
> 
> Interest is charged daily — about $64 a day on this loan — from the closing date to the end of the month. Insurance uses Freddie Mac’s national average and tax the Census Bureau’s 0.89% national ratio.

Earnest money you paid with your offer is credited at closing, as are any seller or lender credits, so your final cash to close is usually lower than the gross total.

## State transfer and mortgage taxes

Two state taxes explain most of the gap between cheap and expensive places to close. A **transfer tax** (sometimes called a deed or documentary stamp tax) is charged on the sale price when the deed is recorded. A **mortgage tax** is charged on the loan amount when the mortgage is recorded, and only a handful of states levy one.

*Statewide taxes on a $360,000 purchase with a $324,000 loan (before county and city taxes)*

| State | Transfer tax rate | Transfer tax | Mortgage tax rate | Mortgage tax |
|---|---:|---:|---:|---:|
| Florida | 0.7% | $2,520 | 0.55% | $1,782 |
| New York | 0.4% | $1,440 | 1% | $3,240 |
| Pennsylvania | 1% | $3,600 | — | — |
| Washington | 1.1% | $3,960 | — | — |
| Virginia | 0.35% | $360 | 0.25% | $810 |
| Georgia | 0.1% | $360 | 0.3% | $972 |
| Minnesota | 0.33% | $1,188 | 0.23% | $745 |
| Texas | 0% | $0 | — | — |

A dash means no statewide mortgage tax in our data. Washington’s rate is graduated and the figure applies its brackets. New York’s mortgage tax is about 1% outside New York City and higher in the city, and Florida’s combines documentary stamps on the note with an intangible tax.

Who pays depends on state law and your contract. Transfer taxes are often the seller’s or split; mortgage taxes attach to your loan, so buyers generally pay them. Counties and cities can add their own taxes and recording fees. Our [closing cost estimator](https://mortgage-math-us.com/tools/closing-cost-calculator/) applies the rules for all 50 states and DC.

[Open the closing cost calculator](https://mortgage-math-us.com/tools/closing-cost-calculator/)

## The escrow deposit and cushion

Most lenders collect property tax and insurance with your monthly payment and pay the bills from an escrow account. At closing you fund that account in section G. The deposit depends on when the next tax and insurance bills fall due, and federal rules let the servicer hold an extra cushion of no more than one-sixth of a year’s escrow payments — 2 months. On the example home that cushion is at most $828.

Escrow money isn’t a fee: it is your money, set aside for bills you would pay anyway. It still has to be in your account on closing day.

## Ways to lower closing costs

- **Compare Loan Estimates.** Request them from several lenders on the same day and compare section A and the total in J, not just the rate.
- **Shop section C.** Get your own quotes for title and settlement services where the lender allows it — but note that services you pick yourself aren’t covered by the 10% limit.
- **Ask the seller for a credit.** Seller concessions can pay part of your closing costs, within limits each loan program sets.
- **Take a lender credit.** A slightly higher rate can cover some costs; it pays off if you won’t keep the loan long.
- **Look for assistance.** Many state housing agencies help with closing costs as well as the down payment — see [first-time buyer programs](https://mortgage-math-us.com/first-time-buyers/programs/).
- **Pick the closing date.** Closing later in the month means less prepaid interest at the table. It doesn’t lower the interest you pay overall, but it eases the cash you need on the day.

FHA borrowers can finance the upfront mortgage insurance premium instead of paying it at closing — see the [FHA loans guide](https://mortgage-math-us.com/loan-types/fha-loans/). The [buying a home hub](https://mortgage-math-us.com/buying/) shows where closing fits in the whole purchase.

## Frequently asked questions

### How much are closing costs for a buyer?

Typically 2%–5% of the purchase price according to the CFPB, paid on top of the down payment. On a $360,000 home that is $7,200 to $18,000. State taxes, title insurance and the escrow deposit explain most of the variation.

### Who pays closing costs, the buyer or the seller?

Each side pays its own, as set by local custom and the purchase contract. Buyers pay most loan-related costs; sellers often pay their agent’s commission and, in many states, some or all of the transfer tax. A seller can also agree to credit you money toward your costs.

### Can closing costs be rolled into the mortgage on a purchase?

Generally not directly, because the loan is capped by the price and the down payment rules. Seller credits and lender credits can cover part of the costs, and FHA lets you finance the upfront mortgage insurance premium.

### What are prepaid costs?

Items you pay in advance at closing rather than fees for services: daily interest from closing to the end of the month, the first year of homeowners insurance and any property taxes due. They appear in section F of the Loan Estimate.

### When will I know my exact closing costs?

Your Closing Disclosure, which must arrive at least 3 business days before closing, shows the final figures. Compare it section by section with your Loan Estimate.

### Why is my cash to close different from my closing costs?

Cash to close adds the down payment and subtracts credits — earnest money already paid, seller credits and lender credits. The Loan Estimate shows the calculation at the bottom of page 2.

## Sources

- [Freddie Mac Primary Mortgage Market Survey](https://www.freddiemac.com/pmms) — 30-year fixed rate, national weekly average (Week of Oct 29, 2026)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25077?g=010XX00US) — Median value of owner-occupied homes (2024 ACS 1-year)
- [CFPB](https://www.consumerfinance.gov/owning-a-home/prepare/figure-out-how-much-you-want-to-spend/) — Typical closing costs, low end (share of purchase price); Typical closing costs, high end (share of purchase price) (Oct 28, 2026)
- [US Census Bureau, American Community Survey 2024 1-year](https://data.census.gov/table/ACSDT1Y2024.B25103?g=010XX00US) — Effective property tax rate (median taxes ÷ median home value) (2024 ACS 1-year)
- [Freddie Mac Research](https://www.freddiemac.com/research/insight/homeowners-insurance-costs) — Average homeowners insurance premium per $1,000 of home value (2023 data)
- [CFPB, Regulation X 1024.17](https://www.consumerfinance.gov/rules-policy/regulations/1024/17/) — Most an escrow account may hold as a cushion (one-sixth of annual escrow payments) (Oct 28, 2026)
- [Florida Department of Revenue](https://floridarevenue.com/Forms_library/current/gt800014.pdf) — State real estate transfer tax (Dec 1, 2017)
- [Florida Statutes 199.133; Florida DOR GT-800014](https://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0100-0199/0199/Sections/0199.133.html) — State tax on recording a mortgage (Oct 28, 2026)
- [New York Department of Taxation and Finance](https://www.tax.ny.gov/pit/mortgage/mtgidx.htm) — State tax on recording a mortgage (Dec 30, 2025)
- [Code of Virginia, Title 58.1, Chapter 8](https://law.lis.virginia.gov/vacodefull/title58.1/chapter8/) — State tax on recording a mortgage; State real estate transfer tax (Oct 28, 2026)
- [Georgia Department of Revenue](https://dor.georgia.gov/intangible-recording-tax) — State tax on recording a mortgage (Oct 28, 2026)
- [Minnesota Department of Revenue](https://www.revenue.state.mn.us/deed-tax-rate) — State real estate transfer tax (Oct 28, 2026)
- [Minnesota Department of Revenue](https://www.revenue.state.mn.us/mortgage-tax-rate) — State tax on recording a mortgage (Oct 28, 2026)
- [Texas Constitution, Art. VIII §29](https://capitol.texas.gov/tlodocs/84R/amendments/html/SJ00001H21.HTM) — State real estate transfer tax (Jan 1, 2016)
- [CFPB](https://www.consumerfinance.gov/ask-cfpb/can-my-final-mortgage-costs-increase-from-what-was-on-my-loan-estimate-en-172/) — Cumulative limit on increases for recording fees and lender-listed services (Sep 11, 2024)
- [New York Department of Taxation and Finance](https://www.tax.ny.gov/bus/transfer/rptidx.htm) — State real estate transfer tax (Jun 1, 2026)
- [Pennsylvania Department of Revenue](https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/realty-transfer-tax) — State real estate transfer tax (Oct 28, 2026)
- [Washington Department of Revenue](https://dor.wa.gov/taxes-rates/other-taxes/real-estate-excise-tax) — State real estate transfer tax (Oct 28, 2026)
- [Georgia Department of Revenue](https://dor.georgia.gov/real-estate-transfer-tax) — State real estate transfer tax (Oct 28, 2026)
- [CFPB](https://www.consumerfinance.gov/owning-a-home/closing-disclosure/) — You receive the Closing Disclosure at least this many business days before closing (Oct 28, 2026)
- [CFPB: Loan Estimate explainer](https://www.consumerfinance.gov/owning-a-home/loan-estimate/)
- [12 CFR 1026.37: Content of the Loan Estimate](https://www.ecfr.gov/current/title-12/chapter-X/part-1026/subpart-E/section-1026.37)

_General information, not financial advice._