Closing costs are the upfront fees you pay to finalize your mortgage. They range from 2% to 5% of your loan amount and can add thousands to your out-of-pocket expenses.
Common Closing Costs
Loan origination fee: 0.5% to 1% of loan amount
Appraisal fee: $300 to $600
Title search and insurance: $500 to $2,000
Credit report fee: $25 to $75
Home inspection: $300 to $500 (optional but recommended)
Prepaid interest, taxes, and insurance: Varies by closing date
How to Lower Closing Costs
Shop multiple lenders, ask the seller to cover a portion, negotiate fees with your lender, or choose a lender credit (higher rate, lower upfront costs). Compare Loan Estimates from at least three lenders.