Closing Costs

mortgage

Also known as: closing costs, settlement costs, mortgage closing costs

Updated · Written and reviewed by Konstantin Iakovlev

Detailed explanation

Itemized on Loan Estimate (within 3 days of application) and Closing Disclosure (3 days before closing). Lender-required: origination fee (~0.5-1% of loan), appraisal ($500-700), credit report ($30), flood determination, tax service fee. Third-party: title insurance (lender + owner — owner's policy is optional but recommended), title search, escrow/settlement agent fee, recording fees, transfer taxes (huge variance by state — DC ~2.2%, NY ~1.4%, many states 0%). Prepaid: first-year homeowner's insurance, ~2-3 months of escrow tax/insurance, per-diem mortgage interest. Seller concessions can cover some — capped by loan type (FHA 6%, conventional 3-9% depending on LTV).

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