LOAN FAQ: Closing Costs
What are closing costs?
Closing costs are the fees you pay when finalizing a real estate transaction, whether you’re refinancing a mortgage or buying a new home. These costs can amount to 2 to 5 percent of the mortgage balance so it’s important to be financially prepared for this expense.
Some of the costs are related to the property — appraising it to verify its value and searching property records to ensure a clear title — and others are related to the paperwork involved, including attorney fees and the expense of originating and underwriting the loan.
Some of the costs are related to the property — appraising it to verify its value and searching property records to ensure a clear title — and others are related to the paperwork involved, including attorney fees and the expense of originating and underwriting the loan.
Average Closing Cost by State
| State | Average Home Sales Price | Average Total Closing Costs with Taxes | Average Total Closing Costs without Taxes | Percentage of Sales Price (with taxes) |
|---|---|---|---|---|
| Washington D.C. | $753,631 | $30,352 | $6,524 | 4.03% |
| Delaware | $313,899 | $17,831 | $3,848 | 5.68% |
| New York | $520,460 | $17,582 | $6,301 | 3.38% |
| Washington | $557,455 | $13,910 | $4,804 | 2.50% |
| Maryland | $386,810 | $12,056 | $3,975 | 3.12% |
| Pennsylvania | $236,906 | $9,753 | $3,241 | 4.12% |
| Connecticut | $418,948 | $8,849 | $4,131 | 2.11% |
| Florida | $368,560 | $8,551 | $4,484 | 2.32% |
| California | $779,838 | $8,219 | $5,773 | 1.05% |
| New Hampshire | $332,880 | $8,162 | $2,795 | 2.45% |
| New Jersey | $447,175 | $7,966 | $4,204 | 1.78% |
| Hawaii | $777,764 | $7,559 | $5,977 | 0.97% |
| Massachusetts | $592,875 | $7,095 | $4,479 | 1.20% |
| Nevada | $410,263 | $6,504 | $4,328 | 1.59% |
| Virginia | $358,930 | $6,373 | $3,462 | 1.78% |
| Vermont | $287,233 | $6,269 | $3,192 | 2.18% |
| Illinois | $282,433 | $5,987 | $4,791 | 2.12% |
| Michigan | $200,331 | $5,704 | $3,501 | 2.85% |
| Utah | $465,574 | $4,751 | $4,751 | 1.02% |
| Rhode Island | $392,302 | $4,683 | $3,053 | 1.19% |
| Maine | $320,185 | $4,400 | $2,848 | 1.37% |
| Oregon | $448,156 | $4,392 | $3,935 | 0.98% |
| Ohio | $202,147 | $4,256 | $3,376 | 2.11% |
| Idaho | $402,043 | $4,101 | $4,101 | 1.02% |
| Minnesota | $282,664 | $4,054 | $2,627 | 1.43% |
| Texas | $294,899 | $3,946 | $3,946 | 1.34% |
| Colorado | $520,372 | $3,895 | $3,812 | 0.75% |
| Arizona | $395,395 | $3,876 | $3,876 | 0.98% |
| Tennessee | $262,382 | $3,869 | $2,655 | 1.47% |
| Georgia | $283,380 | $3,768 | $2,859 | 1.33% |
| Louisiana | $220,594 | $3,629 | $3,301 | 1.65% |
| Alaska | $347,089 | $3,576 | $3,576 | 1.03% |
| New Mexico | $306,594 | $3,489 | $3,489 | 1.14% |
| South Carolina | $295,186 | $3,437 | $2,495 | 1.16% |
| Wisconsin | $225,039 | $3,424 | $2,658 | 1.52% |
| West Virginia | $190,948 | $3,393 | $2,468 | 1.78% |
| South Dakota | $208,904 | $3,064 | $2,806 | 1.47% |
| Montana | $381,220 | $3,055 | $3,055 | 0.80% |
| Alabama | $209,562 | $2,994 | $2,629 | 1.43% |
| North Carolina | $296,206 | $2,970 | $2,425 | 1% |
| Oklahoma | $177,778 | $2,938 | $2,549 | 1.65% |
| Mississippi | $266,367 | $2,799 | $2,799 | 1.05% |
| Kansas | $275,764 | $2,793 | $2,793 | 1.01% |
| Iowa | $202,620 | $2,774 | $2,368 | 1.37% |
| Nebraska | $220,266 | $2,764 | $2,194 | 1.25% |
| Arkansas | $197,137 | $2,608 | $2,071 | 1.32% |
| Wyoming | $337,354 | $2,510 | $2,510 | 0.74% |
| Kentucky | $194,879 | $2,556 | $2,194 | 1.21% |
| North Dakota | $240,774 | $2,321 | $2,321 | 0.96% |
| Indiana | $229,867 | $2,193 | $2,193 | 0.95% |
| Missouri | $238,276 | $2,102 | $2,102 | 0.88% |
Specific Fees in Closing Costs
The closing costs associated with the property are the expenses that help verify the home’s ownership and value. This is important, because the home is the collateral for the mortgage.
- ◉ Appraisal Fee
- ◉ Home-Inspection Fee
- ◉ Title-Search Fee
- ◉ Title-Insurance Fee
- ◉ Prepaid Taxes
Closing Costs and Homebuyers
Most closing costs are paid by the buyer, but some are paid by the seller, such as the real estate agent’s commission. As the buyer, you might try to negotiate some of your costs into the seller’s corner, such as homeowners insurance and property tax escrow deposits, flood and hazard insurance premiums and per-diem interest.
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