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Mortgage Closing Costs Calculator

Mortgage Closing Cost Calculator

Calculator developed by

Use our Mortgage Closing Cost Calculator to determine what your estimated closing costs should be when you buy a home or refinance. Closing costs are typically thousands of dollars and are an important factor for borrowers to review when you shop for a mortgage. Use our calculator to run different scenarios and understand how closing costs change based on property value. You can use this calculator to understand the approximate amount of closing costs you should be paying which can help you avoid excessive fees and save money when you get a mortgage.

Inputs

The value of the property for which you are obtaining the mortgage
Please Enter Property Purchase Price / Value

Outputs

Represents an estimate only. Closing costs vary by lender and service provider
Please note that at the time of closing, in addition to paying the non-recurring closing costs listed above, the borrower is also required to pay recurring closing costs such as interest (from the day of closing until the end of the month in which your mortgage closes), pro-rated property taxes, homeowners insurance, homeowners association fees (if applicable), private mortgage insurance (PMI) (if applicable), mortgage insurance premium (MIP) (if applicable) and impounds

How Our Mortgage Closing Cost Calculator Works

You can use this calculator to estimate your non-recurring mortgage closing costs which are one-time, up-front fees that borrowers pay to third parties to process and close your loan. Our calculator shows you total closing costs as well as an estimated breakdown of these expenses.  To calculate your costs input the estimated property value into the calculator and review the following outputs:

Third Party Closing Costs.  These are fees charged by numerous third parties involved in the mortgage process including the settlement agent or escrow company, closing attorney, title insurance company and property inspector, if applicable. Third party costs vary depending on the property value and location, mortgage amount and service provider.  The higher the property value and loan amount, the higher the third party fees.

Lender Fees.  These are the costs for lender to process your loan including underwriting and closing.  Lender fees are usually a set amount rather than a percentage of the loan amount or property value. Please note that this calculator assumes a flat lender fee of $995. Lender fees vary and some lender may charge no fees although this can result in the borrower paying a higher interest rate, which can cost you more money in interest expense over the life of the mortgage.

Appraisal Fee.  This is the fee charged by the appraiser to provide an appraisal report that assesses the value of your home.  The appraisal report is ordered by the lender but you pay the cost.

Total Non-Recurring Closing Costs.  This is the total of all non-recurring closing costs you are required to pay when you mortgage funds including fees for third party service providers, the lender and appraiser. You are only required to pay non-recurring closing fees once and you are not responsible for these costs after your loan closes. The estimated non-recurring closing costs do not include the cost of any discount points you may decide to pay. A discount point is equal to 1.0% of the amount of the mortgage. If you decide to pay discount points to lower your interest rate, you will incur additional up-front costs.

We recommend that you use Our Mortgage Closing Cost Calculator to compare proposals provided by different lenders to understand how competitive their costs and fees are.

What You Should Know About Mortgage Closing Costs

1

Closing Costs Vary

Mortgage closing costs vary by lender, location, property value, loan amount and program.  Closing costs are typically higher for larger mortgages on more highly valued homes.  Lenders fees also vary and lenders may use different terminology for the fees they charge.  Use our Mortgage Closing Cost Calculator to understand how property value and other factors impact closing costs.  Because mortgage closing costs vary and can run thousands of dollars, borrowers should shop multiple lenders to find the mortgage with the best terms.  Please note that there is usually a trade-off between the mortgage rate and closing costs quoted by lenders with the higher the closing costs, the lower the mortgage rate.  To compare mortgage quotes borrowers should  request a Loan Estimate document from each lender that outlines key mortgage terms such as interest rate and closing costs.  Borrowers can use the Loan Estimate to find the lender offering the mortgage with the lowest closing costs and interest rate.

2

Recurring Versus Non-Recurring Closing Costs

There are two types of mortgage closing costs: recurring and non-recurring.  Recurring closing costs are costs that borrowers continue to pay after the mortgage closes such as partial interest expense, homeowners insurance and pro-rated property tax.  Borrowers are required to pay a portion of these costs when their mortgage closes.  The amount of recurring closing costs primarily depends on when your mortgage closes so it can be difficult to estimate these costs up-front.  Non-recurring closing costs are one-time fees borrowers pay to the lender, settlement / escrow agent, title company, appraiser and other third parties to process and close your mortgage.  Non-recurring closing costs should be outlined up-front before you select a lender for your mortgage and are subject to negotiation because they are set by the lender and other third party service providers.  For example, you may be able to negotiate a lower lender origination fee or appraisal report fee.  Borrowers should compare and negotiate non-recurring closing costs with multiple lenders to reduce their expenses when they get a mortgage.  Our Mortgage Closing Costs Calculator determines estimated non-recurring closing costs to help you negotiate with lenders. 

3

Can You Include Closing Costs in Your Mortgage Amount

Borrowers are not permitted to directly include most closing costs in their loan amount for home purchase loans but you can request a rebate from the property seller to help pay for closing costs.  Having the seller pay for some or all of your closing costs through a rebate is basically the same as adding them to your mortgage amount.  Prospective home buyers with limited funds should consider Closing Cost Assistance Programs which help eligible borrowers pay for part or all of their mortgage closing costs through a grant.  Please note that you can include closing costs directly in your loan amount for refinancings. For example, with a no cost refinance all non-recurring closing costs are added to your new mortgage.  A no cost refinance, however, charges a higher interest rate than a mortgage with standard closing costs.  

4

Make Sure You Have Enough Money to Pay Closing Costs

Most people focus on their down payment when they budget for buying a home but closing costs usually run thousands of dollars.  It is important that you have enough money save to pay for both your down payment and closing costs in addition to any savings in reserve the lender requires you to hold when your mortgage closes.  In some cases, prospective buyers, particularly first-time home buyers, may not be aware of how much closing costs are and this lack of knowledge can create a significant financial obstacle, especially if you are already stretching your budget.  Be sure to factor in closing costs when you determine the total cost to buy a home and make sure you are familiar with programs that may help you pay for all or part of these costs.

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Data provided by Informa Research Services. Payments do not include amounts for taxes and insurance premiums. Click for more information on rates and product details.
While we pride ourselves on the quality and breadth of the FREEandCLEAR mortgage calculators please note that they should be used for informational purposes only. Our calculators rely on assumptions by us and inputs and assumptions provided by you, which may be inaccurate. The outputs from our calculators are estimates only and should not be used as the sole basis for making any financial decisions. Always consult multiple financial professionals when determining the mortgage size and program that is appropriate for you.

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Compare closing costs and mortgage rates for top lenders near you.  Comparing proposals from multiple lenders is the best way to find the mortgage with the lowest closing costs and interest rate

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Ask a Mortgage Expert

Got mortgage questions? We love answering them. Submit your mortgage questions and receive an informative response within 24 hours

Programs

What If You Can't Afford Closing Costs

Do not let the high price of closing costs deter you from buying a home. Review several options for paying for closing costs if you are tight on funds

Sources

Mortgage Closing Costs: https://www.consumerfinance.gov/ask-cfpb/what-costs-will-i-have-to-pay-as-part-of-taking-out-a-mortgage-loan-en-153/

About the calculator developer

Michael Jensen, Mortgage and Finance Guru

Michael is the co-founder of FREEandCLEAR. Michael possesses extensive knowledge about mortgages and finance and has been writing about mortgages for nearly a decade. His work has been featured in leading national and industry publications. More about Michael

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