Closing Costs
Closing Costs: What to Expect When You Buy a Home
A breakdown of the fees and costs involved at closing, so you can budget with confidence.
Closing costs are the fees and expenses you pay when finalizing your home purchase — separate from your down payment. In the US, closing costs typically range from 2% to 5% of the home's purchase price, depending on the state, lender, and loan type.
Breezeful's platform helps you understand these costs upfront, so there are no surprises at the closing table.
Common Closing Costs
What's Typically Included
The specific fees vary by state and lender, but here are the most common items you'll see on a closing disclosure:
- Loan origination fees
- Appraisal fee
- Title search and title insurance
- Recording fees
- Escrow deposits (property taxes and insurance)
- Attorney or settlement fees
- Credit report fee
- Survey fee (if required)
- Prepaid interest
- Homeowner's insurance premium
Cost Breakdown
Loan origination fee
This is what the lender charges to process your loan application. It's typically 0.5% to 1% of the loan amount. Some lenders may waive or reduce this fee — Breezeful's marketplace lets you compare these costs across lenders.
Appraisal fee
The lender requires an appraisal to confirm the property's market value. This typically costs $300 to $600 depending on the property type and location.
Title search and title insurance
A title search verifies that the property's title is clear of liens or disputes. Title insurance protects both the lender and the buyer against future title claims. This is a one-time cost paid at closing.
Recording fees
Charged by your local government to officially record the property transfer and new loan documents. Fees vary by county.
Escrow deposits
Lenders typically require you to prepay several months of property taxes and homeowner's insurance into an escrow account at closing.
State and local transfer taxes
Many states and municipalities charge a transfer tax when property changes hands. Rates vary significantly by location — some states have no transfer tax, while others charge a percentage of the sale price.
Attorney or settlement fees
Some states require an attorney to be present at closing. Even where not required, many buyers choose to have legal representation. Fees typically range from $500 to $1,500.
Prepaid interest
You'll pay interest on your loan from the closing date to the end of that month. Closing earlier in the month means more prepaid interest; closing later means less.
Other Costs to Consider
Additional Costs
These aren't always part of closing costs, but are worth budgeting for:
- Home inspection fee ($300-$500)
- Pest inspection (required in some states)
- Mortgage insurance (PMI for conventional loans under 20% down, or MIP for FHA-insured loans)
- HOA transfer fees (if applicable)
At closing, your lender will provide a Closing Disclosure document at least three business days before the closing date. This details every fee and cost, so you can review everything before signing.
Closing Costs Estimator
Use this estimator to get a rough range of closing costs based on 2%-5% of the home's value:
CLOSING COSTS ESTIMATOR
Estimated Closing Costs
$8,000.00 - $20,000.00
Based on 2%-5% of home value