How to use the closing cost calculator
- Enter the home price and your down payment (as a percent or dollar amount) and the interest rate, which is used only for prepaid interest.
- Review each percentage. Lender fees, points, third-party fees, title and settlement services and transfer or recording fees are editable examples. Replace them with the numbers on your Loan Estimate when you have one.
- Enter the yearly property tax, months of tax collected, first-year insurance premium and any seller credit.
- Read the itemized table, the total closing costs and the estimated cash to close, which adds your down payment. Download the CSV or PDF to compare with lender quotes.
Formula
Loan amount = price - down payment
Lender fees and discount points = loan amount x percent
Third-party, title and settlement, transfer and recording fees = price x percent
Prepaid interest = loan x APR / 365 x days of interest
Prepaid property tax = yearly tax / 12 x months collected. Prepaid insurance = premium you enter
Cash to close = down payment + closing costs - seller credit applied
Each line is rounded to the cent and the total is the sum of the rounded lines. The prepaid interest uses a 365-day year. Some lenders use a 360-day year, which changes that one line slightly.
Worked example
Defaults: a $350,000 home with 20 percent ($70,000) down leaves a $280,000 loan at 6.5 percent. Lender fees of 1 percent of the loan are $2,800.00. Third-party fees of 0.3 percent of the price are $1,050.00, title and settlement of 0.7 percent are $2,450.00 and transfer and recording of 0.3 percent are $1,050.00. Fifteen days of prepaid interest is $280,000 x 6.5% x 15 / 365 = $747.95. Three months of a $3,500 tax bill is $875.00 and the $1,500 insurance premium is $1,500.00.
Together that is $10,472.95, or 2.99 percent of the price. With the $70,000 down payment, cash to close is $80,472.95.
With a seller credit: a $5,000 credit leaves $5,472.95 of closing costs for you and cash to close of $75,472.95. With one discount point: 1 percent of the loan adds $2,800.00 and the total becomes $13,272.95.
What closing costs usually include
Closing costs are the fees and prepaid items due when the loan closes, in addition to your down payment. They commonly include lender charges, appraisal and inspection fees, title search and title insurance, settlement or attorney fees, government transfer and recording charges, and prepaid items such as interest, property tax and insurance.
Which of these apply, and how large they are, depends on your lender, your title company, your state and county, and the type of loan. Some costs are fixed dollar amounts rather than percentages of the price, so a percentage is only a planning shortcut.
Why this is an estimate
Every percentage in this tool is an editable example. It is not a fee schedule, and nothing here is looked up for your area. Within three business days of applying, your lender must provide a Loan Estimate that lists the actual charges. Compare this page with that document line by line, and use the document as the source of truth. The Consumer Financial Protection Bureau explains how to read it.
Prepaid items are not extra fees
Prepaid interest, property tax and insurance are your own ongoing costs, collected early. They raise cash to close but are not charges for a service. If you plan to compare offers, compare the true fees (lender, third-party, title and government charges) separately from the prepaid items.
If you are deciding between a higher rate with low fees and a lower rate with points, the mortgage points calculator shows the break-even. To see the effect of the loan itself, use the mortgage calculator.
Assumptions and limits
- All fee percentages are editable examples, not fee schedules or current market data. Enter the figures from your Loan Estimate for a better answer.
- Closing costs are for a buyer. Seller costs, agent commissions and refinancing costs are not modeled.
- Prepaid interest uses loan x APR / 365 x days. Prepaid tax and insurance use the yearly amounts you enter.
- A seller credit is applied only up to the total closing costs, and lenders may set their own limits on credits.
- Mortgage insurance paid at closing, HOA transfer fees, rate-lock fees and escrow cushions beyond the months you enter are not modeled. This is an estimate, not financial advice.
Frequently asked questions
How much are closing costs for a home buyer?
There is no single figure. Costs depend on the lender, the title company, the state and the loan. This calculator builds an estimate from percentages you control and shows the dollar amount for each item so you can adjust them.
What is cash to close?
It is the money you must bring to closing: your down payment plus closing costs, minus any credits. The calculator reports it separately so you can see how much cash a purchase needs beyond the price of the home.
Can the seller pay my closing costs?
Sometimes. A seller can agree to a credit toward your costs, and the tool subtracts it from what you pay. Whether it is allowed and how much can be used depends on your loan and your contract.
What is prepaid interest at closing?
It is the daily interest from your closing date to the end of that month, collected up front because the first regular payment covers a later period. The tool multiplies the loan, the rate and the days, then divides by 365.
How close will this estimate be to my Loan Estimate?
It can be close or far off, depending on how well the percentages match your lender and area. Treat it as a planning range and rely on the lender document for any decision, since its figures are the official ones.