Closing Costs Explained: Who Pays What, by Deal Type

What closing costs are, and what they aren’t

Closing costs are the charges for the services that move a home from seller to buyer: title search and insurance, the escrow or settlement company, recording the deed, transfer taxes, and, when there’s a loan, the lender’s fees.

Some things show up on the closing statement but aren’t costs:

• Your down payment is part of the price.
• Prepaids and escrow reserves are your own property taxes, insurance and interest paid ahead.
• Prorated taxes and HOA dues, and any mortgage payoff, are settled at closing between the parties.
• Clavesta’s fee is flat and one-time, never a percentage of your price and never charged at closing.

The costs both sides share

Title, settlement, recording and transfer-tax charges averaged about 1% of the price nationally in 2024 (1.06% across 450,000 quotes), from under 0.5% to about 3% depending on the state (LodeStar). Who pays which part follows local custom and your contract; a 50/50 split is a reasonable planning assumption.

Sixteen states have no state transfer tax: Alaska, Arizona, Colorado, Idaho, Indiana, Kansas, Louisiana, Mississippi, Missouri, Montana, New Mexico, North Dakota, Oregon, Texas, Utah and Wyoming. Some local fees may still apply.

In a cash deal, the buyer doesn’t need a lender’s title policy, so this line runs a little lower.

Seller costs

Sellers’ closing costs, not counting commission, typically run about 1% to 3% of the sale price (Redfin, 2026). The main pieces:

• The seller’s share of title, settlement, recording and transfer taxes.
• A closing attorney in states where one usually handles the closing, including Georgia, South Carolina, North Carolina, Massachusetts and New York (rough estimate: $500 to $1,500; get a quote).
• With seller financing, setting up a loan servicer (rough estimate: $100 to $500).

Your mortgage payoff comes out of your proceeds at closing, but it’s your own debt, not a cost of selling.

Buyer costs, by how you pay

Every buyer pays their share of title and settlement. Many also pay for an inspection, and a survey if the title company or lender asks for one. What changes is the financing:

Cost	Cash	Bank loan	Assumable mortgage	Seller financing
Share of title, settlement and taxes	Yes	Yes	Yes	Yes
Home inspection (optional; rough $300 to $500)	Yes	Yes	Yes	Yes
Survey, if required (rough $0 to $1,000)	Sometimes	Sometimes	Sometimes	Sometimes
Loan origination (usually 0.5% to 1% of the loan)	No	Yes	No	No
Appraisal (rough $300 to $700)	Optional	Yes	Sometimes	If the seller asks
Assumption fee	No	No	FHA up to $1,800; VA up to $300 plus a credit report	No
VA funding fee (0.5% of the loan, unless exempt)	No	No	VA assumptions	No
Loan documents and a loan originator (rough $500 to $1,500, often split)	No	No	No	Yes

“Rough” figures aren’t checked against a primary source yet: get a quote.

For a bank loan, there’s an official check: buyers using a mortgage typically pay about 2% to 5% of the price, including prepaids (Freddie Mac, CFPB). An itemized list without prepaids often comes in lower. Your lender’s Loan Estimate lists your actual fees, and you’ll get a Closing Disclosure at least three business days before closing.

The equity gap isn’t a closing cost

When you take over a seller’s loan, you pay the difference between the price and the loan balance, in cash or with a second loan. That’s part of your price, not a closing cost, but plan for it: on a $400,000 home with a $250,000 balance, it’s $150,000.

If there’s a buyer’s agent

Since August 17, 2024, buyers who work with an agent sign a written agreement with them, and pay is negotiated deal by deal. The buyer may pay, or the seller may agree to contribute. Either way, it’s a cost for whoever pays it. Buying or selling directly, there’s no agent commission unless someone chooses to hire an agent.

Estimate yours

The closing costs and savings calculator itemizes typical ranges for your side, state and financing, shows Clavesta’s flat fee, and the commission you’d keep. To compare ways to sell or buy side by side, try your options to sell or your options to buy.