📌 Key Takeaway: Closing costs typically run 2-5% of the purchase price on top of your down payment — on a $400,000 home, that's roughly $8,000-$20,000 in additional cash needed at closing.
What's Included in Closing Costs
| Cost | Typical Range |
|---|---|
| Loan origination fee | 0.5-1% of loan amount |
| Appraisal | $400-$700 |
| Title insurance & search | $1,000-$2,500 |
| Home inspection | $300-$600 |
| Prepaid property tax & insurance | Varies by location |
Ways to Reduce Closing Costs
- Negotiate seller-paid closing costs as part of your offer.
- Ask about lender credits in exchange for a slightly higher rate.
- Combine with a down payment assistance program that also covers closing costs.
- Shop title insurance and other third-party services where your state allows it.
Closing Disclosure: What to Check
You'll receive a Closing Disclosure at least 3 business days before closing — compare it line-by-line against your original Loan Estimate and flag any unexpected increases immediately.
This page is for educational purposes and isn't personalized financial or tax advice. Figures, rates, and program details change frequently — confirm current terms directly with lenders, tax professionals, or the IRS before acting.