Closing Costs Calculator — Itemized Fees, Prepaids, and Cash to Close

Complete Guide: Closing Costs Calculator — Itemized Fees, Prepaids, and Cash to Close

Closing costs are the expenses you pay to get a mortgage beyond the purchase price and down payment. This guide explains what's included, typical ranges in 2025, and how to read the calculator's outputs so you can plan your cash to close with confidence.

What are closing costs?

Buyer closing costs usually fall between 2% and 6% of the loan amount on purchases (often 2%–3% for refinances). They include lender fees (origination, underwriting), third‑party fees (appraisal, credit report), title and escrow services, and government recording. Separate from these are prepaids: interest from your closing date to month‑end and several months of property taxes and homeowners insurance collected to fund your escrow accounts.

What's included vs. prepaids

• Lender fees: Origination (often ~0.5%–1.5% of loan), discount points (optional), underwriting, and processing.
• Third‑party services: Appraisal, credit report, flood cert (if applicable).
• Title & escrow: Title search and insurance, escrow/settlement, notary, courier.
• Government: Recording fees and transfer taxes (vary by state/county).
• Prepaids: Daily interest to month‑end, property tax and insurance deposits (escrows). These are not fees; they're advance payments.

How the calculator works

Start with your price, down payment, and rate. Choose a quick percent estimate or switch to itemized mode for a granular breakdown. The tool separates fees from prepaids and lets you add lender or seller credits. It then shows your total closing costs and final cash to close.

Example: $400,000 purchase with 20% down

Price $400,000, 20% down → loan $320,000. Using a 3.0% estimate: fees ≈ $9,600. If prepaids total $2,100 and you receive a $1,500 lender credit, total closing costs would be ~$11,700 and cash to close ≈ $80,000 (down payment) + $11,700 − $1,500 = $90,200.

Your numbers will differ based on points, credits, state transfer taxes, and escrow months collected. Always compare a few quotes side by side.

How to lower closing costs

• Request lender credits in exchange for a slightly higher rate.
• Shop title and escrow services where allowed; premiums vary by state and provider.
• Ask the seller for concessions (limits apply by loan type and LTV).
• Avoid discount points unless the break‑even period aligns with your plans.
• Close later in the month to reduce prepaid interest days.

Key takeaways

• Plan for 2%–6% of the loan amount in closing costs for purchases (often 2%–3% for refinances).
• Prepaids are advance payments, not fees; the calculator lists them separately.
• Credits reduce cash to close but cannot exceed total eligible costs.
• Use itemized mode to mirror lender quotes and compare providers accurately.