Closing Costs Explained: What to Expect and How to Prepare

Introduction

Closing costs are the fees and expenses you pay to finalize your mortgage, typically ranging from 2–5% of your loan amount. For a $300,000 home, that’s $6,000–$15,000 on top of your down payment.

Understanding these costs upfront helps you budget accurately and avoid surprises at the closing table.

1. Common Closing Cost Items

Typical closing costs include loan origination fees, appraisal fees, title insurance, attorney fees, property taxes (prorated), homeowners insurance, and recording fees.

Your lender is required to provide a Loan Estimate within three business days of your application, detailing expected closing costs.

2. Ways to Reduce Closing Costs

You can negotiate with the seller to cover some or all of your closing costs, especially in a buyer’s market. Some lenders also offer no-closing-cost mortgages in exchange for a slightly higher interest rate.

Shopping around for title insurance, home insurance, and other third-party services can also save you hundreds or thousands of dollars.

Next Steps

Want a detailed breakdown of what closing costs to expect in your area? US Home Portal can connect you with lenders who provide transparent, itemized estimates.