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Calculator results are estimates for planning, not a loan approval, commitment, rate lock, or Loan Estimate.
What the closing costs calculator calculates
Closing costs are the fees and prepaid items due at the closing table, separate from your down payment. This calculator breaks them into line items: loan origination fee, discount points, appraisal, credit report, title insurance (both lender's and owner's policies), attorney or settlement fee, survey, home inspection, and prepaid items like property tax escrow and a year of homeowners insurance.
Some of these are lender charges (origination, discount points), some are third-party charges (appraisal, title, inspection, attorney), and some are prepaid items that fund your escrow account (property tax, insurance) rather than true fees. The calculator separates these so you can see where the money actually goes.
Total closing costs on a typical purchase run roughly 2% to 5% of the purchase price, though the exact figure depends on your location, loan program, and the specific services you choose.
How to use it, step by step
- 1Enter the purchase price of the home you're considering.
- 2Enter your planned loan amount (purchase price minus down payment).
- 3Review the itemized estimate — origination fee, points, appraisal, title insurance, and the other standard line items are pre-populated with typical ranges you can adjust.
- 4Adjust your local property tax rate if you know it, since the property-tax escrow line is one of the larger prepaid items.
- 5Add the total estimated closing costs to your down payment to see the full cash you'd need to bring to the table.
A worked example
Example inputs
- Purchase price
- $400,000
- Loan amount
- $320,000 (20% down)
- Property tax rate
- 1.1% annually
Result
Lender charges (a 1% origination fee plus a typical appraisal and credit report) run around $3,700 in this example. Title insurance, attorney/settlement, survey, and inspection fees add roughly $2,600.
Prepaid items — six months of property tax escrow and a year of homeowners insurance prepaid at closing — make up the rest, around $5,200. Added to the $80,000 down payment, total cash to close in this example is roughly $91,500.
How to read the result
Separate the true fees (origination, title, appraisal, inspection) from the prepaid items (tax escrow, insurance) — the prepaid items aren't really a 'cost,' they're money you'd owe eventually anyway, just collected upfront into escrow.
Closing costs are negotiable in places: a seller can sometimes agree to pay part of them (a seller credit), and some lender fees can be shopped or waived in exchange for a slightly higher rate.
The official, binding number comes from the Loan Estimate a lender provides within three business days of application — this calculator is a planning estimate to use before you get there.
Common mistakes
- Budgeting only for the down payment and being surprised by a five-figure closing-cost bill on top of it.
- Assuming all closing costs are lender fees — a large share is typically third-party charges (title, appraisal, inspection) and prepaid escrow items that aren't negotiable with the lender.
- Using a national average closing-cost percentage instead of checking typical title, recording, and transfer costs for your specific state or county, which vary more than buyers expect.
- Forgetting that a rate you didn't shop for (no discount points) can still mean a higher rate long-term, even if it lowers your closing-cost bill today.
Related guides
Frequently asked questions
Closing costs on a purchase typically run about 2% to 5% of the purchase price, though the exact amount depends on your loan amount, location, title and settlement fees, and whether you choose to pay discount points.
On a purchase, most closing costs are generally paid in cash at closing rather than financed, though some programs allow limited seller or lender credits to offset them. On a refinance, it's more common to roll closing costs into the new loan balance.
The down payment is equity you're putting into the home itself and reduces your loan amount. Closing costs are separate fees and prepaid items — origination, title, appraisal, escrow — required to complete the transaction, on top of the down payment.
In many markets and loan programs, a seller can agree to a credit toward the buyer's closing costs as part of the purchase negotiation, subject to program limits. This is common in slower markets and less common in competitive ones.
Lenders that escrow taxes and insurance collect a cushion upfront — often several months of property tax and a full year of homeowners insurance — so the escrow account has funds on hand before your first regular payments build it back up.