Closing Costs Calculator: Cash Needed to Close
How much cash do I need to close on a house? Enter the price, your down payment and a percentage for each kind of cost. The defaults are placeholders; replace them with the figures on your lender's estimate.
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Formula
- Lender fees =
loan amount x lender %, where loan = price x (1 - down payment %) - Title, transfer taxes, third-party fees and prepaid items =
price x their % - Total closing costs = sum of the items, each rounded to cents
- Cash to close =
down payment + total closing costs
Worked example
Price 400,000, 20% down (loan 320,000), lender 1%, title 0.5%, transfer 0.5%, third-party 0.3%, prepaid 0.5%:
- Lender 3,200, title 2,000, transfer 2,000, third-party 1,200, prepaid 2,000
- Total 10,400 (2.6% of the price)
- Cash to close: 80,000 + 10,400 = 90,400
The percentages are your own estimates; the page applies no national rates.
When to use it
Use this page to budget the cash you need on the day of purchase, over and above the deposit. It does not work out the monthly payment: use the mortgage calculator for that, and the home affordability calculator to see what price your income supports. For the costs of selling instead, use the home sale proceeds calculator.
Second example
A 300,000 home with 10% down (loan 270,000): lender 1% = 2,700, title 1,500, transfer taxes 1,500, third-party 900, prepaid 1,500. Total 8,100, cash to close 38,100.
Common mistakes
- Forgetting prepaid taxes and insurance.
- Applying every percentage to the price when lender fees are charged on the loan.
- Using someone else's percentages; fees vary widely by place.
- Leaving out moving costs and repairs, which are not closing costs but still need cash.
Frequently asked questions
What are closing costs?
They are the fees and prepaid items due when a home purchase completes, on top of the down payment: lender charges, title and legal work, transfer taxes, appraisal and inspection, and prepaid taxes and insurance.
How much are closing costs?
The defaults here total 2.6% of the price. On a 400,000 home with 20% down that is 10,400: lender fees 3,200, title 2,000, transfer taxes 2,000, third-party fees 1,200 and prepaid items 2,000. Actual figures vary widely by place, so use your own quotes.
How much cash do I need to close?
Down payment plus closing costs. In the example above that is 80,000 + 10,400 = 90,400.
Why are lender fees based on the loan?
Lenders usually charge origination fees on the amount borrowed, so a bigger down payment lowers them. A 1% fee on a 320,000 loan is 3,200. The other items are applied to the price.
What are closing costs on a 300,000 house with 10% down?
With the default percentages, lender fees on the 270,000 loan are 2,700 and the other items add 5,400, so closing costs are 8,100 (2.7% of the price). Cash to close is 30,000 + 8,100 = 38,100.
Can closing costs be added to the loan?
Some lenders allow it, or a seller may credit part of the costs, but the cash you need at closing falls only because you borrow more. Rolling 8,100 into a 30-year loan at 6% adds about 48.56 to the monthly payment.
What is the difference between closing costs and the down payment?
The down payment buys part of the home and builds equity. Closing costs pay for fees and prepaid items and do not build equity, so a 20% down payment on 400,000 is 80,000 while the 10,400 of closing costs is money you do not get back.