Closing Cost Calculator
Estimate your total cash to close with a fully itemized breakdown of lender fees, title insurance, escrow, and government charges. Customize every line item to match your deal.
Loan Details
Lender Fees
Each point = 1% of loan, reduces rate ~0.25%
Third-Party Services
Government Fees
Prepaid & Escrow
Days from closing to end of month
View itemized breakdown
How Closing Costs Work #
Closing costs are the fees and expenses you pay on top of your down payment when finalizing a home purchase. They cover the services required to originate the loan, transfer the title, and set up your escrow account. On a typical home purchase, closing costs range from 2% to 5% of the purchase price — so on a $400,000 home, you should budget $8,000 to $20,000 in addition to your down payment.
These costs are divided into four main categories. Lender fees include the origination fee (typically 0.5%–1% of the loan amount) and any discount points you choose to buy to lower your interest rate. Each discount point costs 1% of the loan and typically reduces your rate by about 0.25 percentage points. Third-party fees cover services from independent providers: the home appraisal ($300–$600), home inspection ($300–$500), title insurance (0.5%–1% of the home price), and the title search ($75–$200).
Government fees include the recording fee paid to your county to register the deed and mortgage ($50–$250) and transfer taxes that vary significantly by state and locality (0%–2% or more of the home price). Some states like Oregon have no transfer tax, while others like New York charge 1%–2% depending on the sale price. Prepaid items and escrow deposits are not technically fees — they are advance payments you would owe regardless — but they are due at closing and increase your total cash requirement.
Prepaid interest covers the daily interest charges from your closing date through the end of that month. Since mortgage payments are made in arrears (each payment covers the prior month's interest), this bridges the gap between closing and your first payment. Closing later in the month reduces this cost. Your lender will also require you to deposit several months of property tax and insurance into an escrow account. Tax escrow is typically 2–3 months, while insurance escrow can be up to 14 months (a full year's premium plus a 2-month cushion).
Understanding each line item gives you leverage to negotiate. Lender fees, title insurance, and inspection costs are all areas where shopping around or asking your lender for a credit can save hundreds or even thousands of dollars. Government fees, on the other hand, are typically fixed by law and non-negotiable. The calculator above lets you customize every line item to match the estimates on your Loan Estimate document so you can plan your total cash to close with confidence.
Closing Costs by Home Price #
Closing costs scale with home price, but not all components are proportional. Lender fees and title insurance are percentage-based, while flat fees (appraisal, inspection, recording) stay constant regardless of purchase price. Here are typical ranges assuming 20% down, standard lender fees, and average third-party costs:
| Home Price | Closing Costs (2%–5%) | Down Payment (20%) | Total Cash to Close |
|---|---|---|---|
| $200,000 | $4,000–$10,000 | $40,000 | $44,000–$50,000 |
| $300,000 | $6,000–$15,000 | $60,000 | $66,000–$75,000 |
| $400,000 | $8,000–$20,000 | $80,000 | $88,000–$100,000 |
| $500,000 | $10,000–$25,000 | $100,000 | $110,000–$125,000 |
| $750,000 | $15,000–$37,500 | $150,000 | $165,000–$187,500 |
Transfer taxes can dramatically shift these numbers. In states like New York or Delaware, transfer taxes alone can add 1%–2% to closing costs, while states like Oregon charge no transfer tax at all. Enter your specific fees in the calculator above for an accurate estimate.
Tips to Reduce Closing Costs #
While some closing costs are fixed, there are several proven strategies to lower your total out-of-pocket expense at closing:
- Shop for title insurance — Title insurance premiums are not regulated the same way in every state, and rates can vary by hundreds of dollars between providers. In many states, buyers can choose their own title company rather than using the one suggested by the seller or real estate agent.
- Negotiate the origination fee — Lenders have flexibility on origination fees, especially if you have strong credit and are comparing offers from multiple lenders. Some may waive the fee entirely to win your business, though they may recoup it through a slightly higher interest rate.
- Ask for seller concessions — In buyer-friendly markets, you can negotiate for the seller to pay some or all of your closing costs. Conventional loans allow seller concessions of up to 3% of the sale price for down payments under 10%, 6% for 10%–25% down, and 9% for 25% or more down.
- Close at the end of the month — Since prepaid interest covers the days from closing to month-end, closing on the 28th instead of the 5th can save you three weeks of daily interest charges.
- Compare Loan Estimates — Federal law requires lenders to provide a standardized Loan Estimate within three business days of your application. Compare estimates from at least three lenders to identify the best combination of rate, points, and fees.
Frequently Asked Questions #
What are closing costs when buying a home?
Closing costs are fees and expenses paid when finalizing a home purchase, separate from your down payment. They include lender fees (origination, discount points), third-party fees (appraisal, inspection, title insurance), government charges (recording fees, transfer taxes), and prepaid items (property tax escrow, insurance escrow, prepaid interest). Total closing costs typically range from 2% to 5% of the purchase price.
How much are typical closing costs?
Typical closing costs range from 2% to 5% of the home's purchase price. On a $400,000 home, expect $8,000 to $20,000 in closing costs. The exact amount depends on your location, loan type, lender fees, and whether you buy discount points. Some costs like transfer taxes vary significantly by state and county.
What is the difference between closing costs and down payment?
Your down payment goes toward the purchase price and builds immediate equity. Closing costs are separate fees paid to lenders, title companies, appraisers, and government agencies for services required to complete the transaction. Both are due at closing — your total cash to close equals your down payment plus all closing costs.
Can I negotiate closing costs?
Yes, several closing costs are negotiable. You can shop around for title insurance and inspections, negotiate the origination fee with your lender, or ask the seller to contribute toward your closing costs. Some lenders offer no-closing-cost mortgages in exchange for a higher interest rate. Government fees like recording fees and transfer taxes are generally non-negotiable.
What are discount points and should I buy them?
Discount points are upfront fees paid to reduce your interest rate — one point equals 1% of the loan amount and typically lowers your rate by about 0.25%. Points make sense if you plan to stay in the home long enough for the monthly savings to exceed the upfront cost, usually 4 to 7 years. If you might sell or refinance sooner, points are generally not worth the upfront expense.
How much are closing costs on a $400,000 home?
On a $400,000 home, expect closing costs between $8,000 and $20,000 (2%–5% of the purchase price). The lower end is typical when you skip discount points, shop for competitive title insurance, and close in a state with low transfer taxes. The higher end applies when buying points, paying higher origination fees, or purchasing in a high-transfer-tax state. With 20% down ($80,000), your total cash to close would be $88,000–$100,000.
What is prepaid interest at closing?
Prepaid interest covers daily interest charges from your closing date until the end of that month. Since mortgage payments are made in arrears, this bridges the gap between closing and your first payment. Closing earlier in the month means more prepaid interest; closing at month-end minimizes this cost.