Closing Cost Calculator

Closing costs are the collection of one-time fees and expenses paid by both the buyer and seller (but primarily the buyer) at the final stage of a real estate purchase. These costs cover services essential to finalizing the loan and transferring property ownership, such as appraisal fees, title insurance, and lender fees.

Generally, buyers should expect closing costs to range from 2% to 5% of the total loan amount (not the purchase price). This estimate can vary significantly based on your state, loan type, and the lender you choose.

Your total closing costs are calculated by your mortgage lender and an escrow or title company. The lender calculates the charges related to the loan (like origination fees and prepaid interest), while the title company calculates fees for title insurance, government recording, and any necessary escrows for taxes/insurance. All of these figures are detailed in your mandatory Loan Estimate and final Closing Disclosure.

Closing costs are typically calculated from three main categories: Lender/Loan Fees: Charges for securing the loan, like the loan origination fee, underwriting fee, and discount points (if applicable). Third-Party Service Fees: Costs for services ordered by the lender, such as the appraisal, credit report, and title search/insurance. Prepaid/Escrow Items: Expenses paid upfront or into an escrow account, which include property taxes, homeowner's insurance premiums, and prepaid interest.

Yes, many closing costs are negotiable. While government fees and transfer taxes are fixed, you can often save money by:

• Shopping for Lenders: Comparing the loan origination and underwriting fees of several lenders.
• Shopping for Third-Party Services: In some states, you can choose your own title company or inspector.
• Negotiating with the Seller: Asking the seller to contribute to your closing costs as part of your purchase offer.

You will receive a mandatory document called the Closing Disclosure at least three business days before your closing date. This document provides a final, detailed breakdown of all your loan terms and the exact cash-to-close amount, which must be very close to the figures presented in the initial Loan Estimate.