Is it true that third-party services like title insurance can be shopped?

Third-party services like title insurance can be shopped

Is it true that recording fees and transfer taxes are set by government?

Recording fees and transfer taxes are set by government

Is it true that no-closing-cost mortgages roll costs into the rate, not eliminate them?

No-closing-cost mortgages roll costs into the rate, not eliminate them

2-5% of loan amount

Mortgage closing costs: what each fee is

Closing costs can total $8,000-$20,000 on a typical home purchase. Here is what each line item represents and which ones can be negotiated.

Quick answer

Mortgage closing costs typically run 2-5% of the loan amount and include lender fees (origination, underwriting), third-party costs (appraisal, title insurance, survey), prepaids (property tax escrow, insurance, interest), and recording fees. Many fees are negotiable or shoppable — title insurance, especially, varies by 30-50% across providers. The Loan Estimate form (provided within 3 days of application) lays them all out for comparison.

Level

Try calculator

Key takeaways

04 · ideas

Origination fees are the most negotiable of closing costs
Third-party services like title insurance can be shopped
Recording fees and transfer taxes are set by government
No-closing-cost mortgages roll costs into the rate, not eliminate them

Closing costs are fees paid at mortgage closing, separate from the down payment. They typically range from 2-5% of the loan amount.

Lender fees (most negotiable):

Origination fee / loan points
Underwriting fee
Application fee

Third-party fees (some shopping possible):

Title search and title insurance (owner and lender policies)
Appraisal
Home inspection
Attorney or settlement agent fees

Government fees (generally fixed):

Recording fees
Transfer taxes (vary widely by state/county)

Prepaid items (not fees, but paid at closing):

Homeowner's insurance premium
Property tax escrow
Prepaid mortgage interest