How to use this calculator
- Home price and down payment: the loan amount is the difference.
- Loan type: conventional, FHA or VA. FHA and VA loans add an upfront fee you can usually finance; choose whether to add it to the loan or pay it at closing.
- Interest rate: used to estimate prepaid interest.
- Lender fees: origination as a percentage of the loan, any discount points, and other lender charges.
- Title, escrow and government fees: appraisal, title and settlement, and recording fees and transfer taxes.
- Prepaids and escrow: your property tax rate, insurance premium, days of prepaid interest and months of reserves.
The defaults are placeholders, not quotes. Once you have a Loan Estimate, replace each line with the lender’s figures.
How closing costs are calculated
Some items are fixed fees; others scale with the loan or the home:
- Origination and points = loan amount × percentage
- FHA upfront mortgage insurance = base loan × 1.75%
- VA funding fee = loan × 1.25%–3.3%, depending on your down payment and whether you’ve used the benefit before
- Prepaid interest = loan × annual rate ÷ 365 × days until month-end
- Tax reserve = price × tax rate ÷ 12 × months
- Insurance = one year’s premium, plus a few months’ reserve
Worked example
A $400,000 home with $40,000 down on a conventional loan at 6.5% (a $360,000 loan), using the defaults:
| Item | Amount |
|---|---|
| Origination fee (0.5% of loan) | $1,800 |
| Other lender fees | $1,200 |
| Appraisal | $650 |
| Title insurance, escrow & settlement | $2,500 |
| Recording fees & transfer taxes | $500 |
| Prepaid interest (15 days) | $962 |
| First year of home insurance | $1,800 |
| Property tax reserve (3 months) | $1,100 |
| Insurance reserve (2 months) | $300 |
| Total closing costs | $10,812 |
That’s 2.7% of the price. Add the $40,000 down payment and your cash to close is $50,812. More than a third of the total, $4,162, is prepaids and escrow: money that pays your own taxes, insurance and interest rather than anyone’s fees.
FHA and VA loans
Government-backed loans add an upfront fee:
- FHA: an upfront mortgage insurance premium of 1.75% of the base loan. On a $400,000 home with 3.5% down ($386,000 base loan), that’s $6,755. Financed, it raises the loan to $392,755 and the cash closing costs are about $11,063. Paid in cash, closing costs jump to about $17,766.
- VA: a funding fee of 2.15% for first use with less than 5% down, 1.5% with 5% or more, and 1.25% with 10% or more; after first use, the fee with less than 5% down is 3.3%. On a $400,000 home with nothing down, that’s $8,600 first time or $13,200 after. Veterans receiving VA compensation for a service-connected disability, and some others, are exempt.
How your price changes the percentage
Same defaults, 10% down:
| Home price | Closing costs | Share of price |
|---|---|---|
| $250,000 | $9,364 | 3.7% |
| $400,000 | $10,812 | 2.7% |
| $600,000 | $12,742 | 2.1% |
Flat fees weigh more on cheaper homes, so the percentage falls as the price rises. Real title, recording and transfer costs also vary widely by location. LodeStar Software Solutions’ 2025 data put title, settlement, recording and transfer tax costs at about 1.04% of the price on average nationally, from roughly 0.4% in the cheapest states to about 3% in the most expensive. Those figures leave out lender fees and prepaids, which come on top.
Tips to reduce what you bring to closing
- Shop lenders. Origination, underwriting and points vary the most from lender to lender. Compare the Loan Costs section of each Loan Estimate.
- Shop the services you’re allowed to. Your Loan Estimate lists services you can shop for, which often include title and settlement.
- Negotiate seller credits. A seller can agree to pay some of your costs; VA caps seller concessions at 4% of the home’s value.
- Time your closing. Closing late in the month means fewer days of prepaid interest.
- Look for help. Many states and cities offer closing cost assistance for first-time buyers; a HUD-approved housing counselor can point you to programs.
To see how closing costs fit your overall budget, try the home affordability calculator, and use the mortgage calculator for the monthly payment. If you’re still deciding whether to buy, the rent vs. buy calculator includes closing and selling costs.
Assumptions and limitations
This calculator gives a national-style estimate from the numbers you enter. It doesn’t know your state’s transfer tax, title insurance rates or recording fees, who customarily pays which charges where you live, or your lender’s escrow rules. It doesn’t subtract earnest money or seller credits. Conventional loans with less than 20% down may also require PMI, which is usually paid monthly rather than at closing.
Sources
- Consumer Financial Protection Bureau: Determine your down payment (closing costs typically 2%–5% of the purchase price)
- Consumer Financial Protection Bureau: Loan Estimate explainer
- U.S. Department of Veterans Affairs: VA funding fee and loan closing costs (rates effective April 7, 2023)
- U.S. Department of Housing and Urban Development: FHA MMI Fund quarterly report to Congress, FY2026 Q1 (1.75% upfront premium)
- National Mortgage News: Purchase mortgage closing costs dipped in 2025 (LodeStar data, April 2026)
These are estimates for planning only. Your lender’s Loan Estimate and Closing Disclosure show your actual costs.
Frequently asked questions
How much are closing costs for a buyer?
The CFPB says closing costs typically run 2% to 5% of the home purchase price, not counting your down payment. With this calculator's defaults, a $400,000 home with 10% down comes to about $10,812, or 2.7%. Your actual number depends on your lender, your state and county, and how much you prepay for taxes and insurance.
What's included in closing costs?
Lender charges (origination, underwriting, points), third-party services (appraisal, title insurance, settlement or attorney fees), government recording fees and transfer taxes, and prepaid items such as interest, the first year of homeowners insurance and an initial deposit into your escrow account for taxes and insurance.
Are prepaids and escrow really closing costs?
They're due at closing, so you need the cash, but they aren't fees. Prepaids and escrow reserves are your own property tax, insurance and interest paid in advance. In our default example they account for $4,162 of the $10,812 total.
Can I roll closing costs into an FHA or VA loan?
The FHA upfront mortgage insurance premium (1.75% of the base loan) and the VA funding fee can be added to the loan, and nearly all FHA borrowers finance the premium. On a VA purchase loan, the funding fee is the only fee you can finance; other closing costs are paid at closing, though a seller can agree to pay some of them.
How can I lower my closing costs?
Compare Loan Estimates from several lenders, since lender fees vary most. Ask the seller for a credit toward closing costs, shop for services your lender lets you choose (such as title or settlement), and look for state or local first-time buyer programs. Closing near the end of the month also reduces prepaid interest.
What is cash to close?
It’s the total you bring to the closing table, meaning your down payment plus closing costs, minus any earnest money deposit you've already paid and any seller credits. The calculator shows down payment plus closing costs; subtract your deposit and credits to match your Closing Disclosure.
Updated November 2026. Results are estimates for educational purposes and depend on the inputs you provide.