Closing cost calculator

How the estimate is built

Closing costs on a residential file come from four different places, and only one of them is really yours to set. Understanding which is which is what makes a quote defensible.

1. Title insurance premiums

The owner's policy is priced off the purchase price; the lender's policy is priced off the loan amount. Premium curves are tiered and regressive — the rate per thousand drops as the policy amount climbs — which is why doubling the price never doubles the premium.

The rule that surprises people most is the simultaneous issue: when both policies are issued on the same transaction at the same time, the lender's policy comes at a small flat charge rather than a second full premium. That is why a $400,000 purchase with a $320,000 loan costs far less than the two policies priced independently — and why a refinance, which has no owner's policy beside it, is quoted on a different footing.

2. Who sets the rate

Three regimes, and the state you are closing in decides which one applies:

• Promulgated — the state sets the premium and every agent charges the same for the same coverage. Texas, Florida and New Mexico work this way, so shopping title companies on price alone is pointless there.
• File and use — the majority of states. Each underwriter files its own rate schedule with the insurance department and must adhere to what it filed. Premiums can genuinely differ between underwriters.
• Effectively unregulated — a handful of states leave rates to the market.

Iowa is its own case entirely: private title insurance is barred, and coverage runs through the state-run Iowa Title Guaranty at a fraction of typical premiums.

3. Transfer tax — the biggest state-to-state swing

This is where two identical closings in different states stop resembling each other. A $400,000 sale carries no state transfer tax at all in Texas, Arizona, Indiana, Louisiana, Mississippi, Missouri, Montana, New Mexico, North Dakota, Oregon, Utah, Wyoming, Kansas, Idaho and Alaska — and several thousand dollars in Delaware, Pennsylvania, Washington or Vermont.

The calculator applies the state-level rate only. Counties and municipalities pile on their own: Chicago, New York City, Philadelphia, San Francisco, Miami-Dade and most Maryland and Virginia counties all add materially to the state figure. Where that is common the calculator flags it — and the line is editable so you can enter the real number.

4. Who pays what

The buyer/seller split is local custom, not law, and it is always negotiable in the contract. Broadly: the seller customarily buys the owner's policy across Texas, Florida, the Midwest and much of the South; the buyer customarily buys it across the Northeast, Mid-Atlantic and much of the West. Recording the deed usually follows the seller, recording the mortgage always follows the buyer.

The calculator defaults each line to the custom for the state you pick, and every line can be flipped to the other party — because on any given file the contract can say whatever the parties agreed.

Frequently asked questions

Who pays for the owner's title policy?

It is local custom, not law, and it is always negotiable in the contract. In roughly half the country — Texas, Florida, most of the Midwest and much of the South — the seller customarily pays. In the Northeast, Mid-Atlantic and much of the West the buyer customarily pays. The calculator defaults to the local custom and lets you move any line to the other side.

What is a simultaneous issue rate?

When an owner's policy and a lender's policy are issued on the same transaction at the same time, the lender's policy is issued at a steeply discounted flat charge rather than at full rate. That discount is why a purchase with a loan costs far less than the two premiums added together, and why a refinance is priced differently.

Are title insurance rates the same at every title company?

It depends on the state. Texas, Florida and New Mexico promulgate rates, so every agent charges the same. Most other states are file-and-use: each underwriter files its own rates and must adhere to them, so premiums can differ. A few states leave rates effectively unregulated.

Does this calculator include local transfer taxes?

It applies the state-level rate only. Counties and cities frequently add their own transfer or recordation tax on top. Where a local add-on is common the calculator says so, and the transfer tax line can be overridden with your exact figure.

Is this an official quote?

No. It is an estimate for planning and pre-quote conversations. Actual premiums come from your underwriter's filed rate schedule or the state's promulgated table, and actual recording fees and transfer taxes come from the county. Every line is editable so you can drop in your own rate card.