Closing Costs Calculator
Use our free Closing costs Calculator to plan your taxes & closing strategy. Get detailed breakdowns, charts, and actionable insights.
Reviewed by Sahil, Senior Finance & Tax Editor
Formula
Buyer Closing Costs = Title + Appraisal + Inspection + Origination + Recording + Prepaids + Escrow
Closing costs are the sum of all fees and prepaid items required at settlement. Buyer costs typically include lender fees, third-party services, and prepaid items. Seller costs include agent commissions, transfer taxes, and title fees. Costs vary by state, lender, and loan type.
Worked Examples
Example 1: First-Time Home Buyer
Problem:Buying a $350,000 home with a $280,000 loan (20% down) in a state with average closing costs.
Solution:Buyer costs:\nTitle Insurance: $1,750\nAppraisal: $500\nInspection: $400\nLoan Origination: $2,800\nRecording: $250\nPrepaids: ~$3,500\nAttorney: $1,000\nTotal buyer costs: ~$11,200 (3.2% of home price)
Result:Estimated buyer closing costs: $11,200 | Seller costs: $19,500 | Total: $30,700
Frequently Asked Questions
What are closing costs?
Closing costs are the fees and expenses paid at the real estate transaction closing, beyond the property's purchase price. For buyers, they typically range from 2-5% of the home price and include lender fees, title insurance, appraisal, inspections, prepaid items (taxes, insurance), and government recording fees. For sellers, closing costs are usually 6-10% of the sale price, primarily from real estate agent commissions (5-6%) and transfer taxes. These costs are paid on the closing day when ownership officially transfers.
Who pays closing costs — buyer or seller?
Both buyers and sellers pay closing costs, though the amounts differ. Buyers typically pay 2-5% of the home price for lender-related fees, title insurance, appraisals, inspections, and prepaid items. Sellers typically pay 6-10%, mostly due to real estate agent commissions (5-6%). In some markets, sellers may offer to pay a portion of the buyer's closing costs as a concession to close the deal. VA and FHA loans have specific rules about which costs sellers can cover. Closing cost responsibilities can be negotiated in the purchase agreement.
Can closing costs be rolled into the mortgage?
Some closing costs can be financed into certain loan types. FHA loans allow closing costs to be rolled in if the home appraises for more than the purchase price. USDA loans allow this as well. VA loans permit the funding fee to be financed. Conventional loans generally don't allow closing costs to be added to the loan balance, but you can opt for a 'lender credit' where the lender covers closing costs in exchange for a higher interest rate (called a no-closing-cost mortgage). Alternatively, you can negotiate seller concessions to cover your closing costs.
How do closing costs vary by state?
Closing costs vary significantly by state due to different transfer taxes, title insurance regulations, and legal requirements. States with highest closing costs include New York, Pennsylvania, and New Jersey (4-5% of home price). States with lower costs include Colorado, Missouri, and Indiana (under 2.5%). Some states require attorney involvement at closing (adding $1,000-2,000), while others don't. Transfer taxes range from zero (Texas) to over 2% (Pennsylvania, Washington for high-value homes). Always get a Loan Estimate from your lender for accurate local costs.
References
Reviewed by Sahil, Senior Finance & Tax Editor · Editorial policy