Mortgage closing costs calculator

How this calculator works

This calculator estimates the cash a home buyer may need at closing—not the monthly payment or long-term housing cost. It adds the down payment to buyer-paid lender fees, third-party settlement charges, and prepaid items such as homeowners insurance, property taxes, and initial escrow reserves, then subtracts seller or lender credits.

The result is total estimated cash to close, separate from the loan amount borrowed. Down payment reduces how much you finance; closing costs pay for originating and settling the loan plus funding prepaid and escrow items. Credits from the seller or lender reduce cash required when permitted by the loan program and purchase contract.

This is a planning estimate, not a quote. Actual charges vary by location, lender, loan type, property taxes, insurance premiums, and timing of the closing date relative to tax and insurance billing cycles. Replace these inputs with figures from the Loan Estimate and Closing Disclosure as soon as they are available.

What affects the result

Cash to close combines several categories that buyers often underestimate beyond the down payment alone.

• Down payment percentage — A 20% down payment on $400,000 is $80,000; 10% is $40,000. Lower down payments may add PMI and affect allowable seller credits.
• Lender fees — Origination, underwriting, processing, document preparation, and discount points can total 0.5%–1.5% of the loan amount or more depending on the lender and rate structure.
• Third-party services — Appraisal, credit report, title search, title insurance, settlement or attorney fees, recording charges, and survey costs vary by state and transaction complexity.
• Prepaids and escrow — Lenders often collect several months of homeowners insurance, property taxes, and per-diem mortgage interest at closing to establish escrow reserves and cover the period before the first payment.
• Seller and lender credits — Seller concessions and lender credits reduce cash to close but are capped by loan program rules and appraised value. Credits generally cannot exceed eligible closing costs or be taken as cash to the buyer.
• Loan type and occupancy — FHA, VA, and USDA loans have different fee structures. Investment properties may require larger reserves and higher fees.

Buyers who budget only for down payment often discover a $10,000–$20,000+ gap when prepaids and fees are included on a typical purchase.

Real-world examples

1. Standard conventional purchase. $400,000 home, 20% down ($80,000), $8,000 in lender and third-party fees, $4,000 prepaids, $2,000 seller credit. Estimated cash to close: $80,000 + $8,000 + $4,000 − $2,000 = $90,000—not just the $80,000 down payment.

2. Low down payment with PMI. Same $400,000 home with 10% down ($40,000), $9,500 fees and prepaids, $3,000 seller credit. Cash to close near $46,500, plus ongoing PMI until 80% LTV—model PMI with the PMI calculator.

3. Discount points at closing. One point on a $320,000 loan adds $3,200 to lender fees. Include points in closing cost inputs when comparing with the mortgage points calculator.

4. Year-end closing timing. Closing near a property tax due date or mid-month can increase prepaid tax and per-diem interest amounts compared with closing at the start of the month—changing cash to close by hundreds or thousands without changing the purchase price.

Common mistakes

• Treating the down payment as the entire cash requirement. Fees and prepaids are separate and due at closing in most purchases.
• Forgetting prepaid taxes, insurance, and escrow funding. Initial escrow deposits are not optional when the lender requires impounds.
• Counting credits that the loan program does not permit. Excess seller credit cannot usually become cash back; it may reduce allowable items only.
• Using an online estimate instead of the lender's disclosures. Loan Estimate page 2 itemizes borrower charges; Closing Disclosure finalizes them.
• Ignoring reserves after closing. Lenders may require remaining assets beyond cash to close. Budget for moving, repairs, and emergency fund separately.
• Mixing closing costs into the loan without understanding cost. Rolling fees into the loan reduces upfront cash but increases borrowed amount and interest over time.

When to use this calculator

Use this calculator while setting a home-buying budget, comparing offers with different seller credits, or estimating how much liquid cash you need beyond the down payment saved so far.

Run it early in the process, then replace every line item with figures from your Loan Estimate once you apply. Combine with the home affordability calculator for monthly payment capacity, the loan payment calculator for principal and interest, the PMI calculator when putting less than 20% down, and the mortgage points calculator when evaluating discount points.

Treat the output as a planning range until the Closing Disclosure confirms final numbers.

Related calculators

Estimate affordable purchase price and monthly payment with the home affordability calculator. Calculate mortgage principal and interest with the loan payment calculator. Estimate PMI on low-down-payment loans with the PMI calculator. Evaluate discount points break-even with the mortgage points calculator.