The sticker price of a home is almost never the whole amount you hand over on closing day. Beyond your down payment, buyers pay a stack of lender charges, title fees, prepaid escrow items, and settlement costs that typically add up to 2%–5% of the purchase price. On a $400,000 home, that is roughly $8,000–$20,000 of extra cash — money many first-time buyers forget to budget for. This closing cost calculator from Smekys breaks the bill into the four buckets a Closing Disclosure actually uses, so you can see which fees run on the loan, which are fixed, and which scale with the price.
How to Use
- Enter the Home Purchase Price you agreed to pay the seller.
- Set your Down Payment as a percent of the price. 20% is the classic number that avoids PMI; 3%–5% is common for first-time buyers.
- Enter the Lender Origination Rate. This fee is charged on the loan amount, not the price, and usually runs 0.5%–1.5%.
- Set the Other Closing Costs Rate — recording, transfer tax, attorney and misc fees as a percent of the price, usually 1%–3%.
- Add the Title & Settlement Fee. This is a fixed dollar amount for title insurance and the settlement agent, typically $1,500–$3,500 and varies by state.
- Choose how many months of taxes and insurance the lender will collect into escrow at closing (usually 2–6 months).
- Enter your Annual Property Tax and Annual Homeowners Insurance so the prepaid escrow bucket is real.
The result card then shows each fee bucket separately, the total closing costs, and the total cash you need to bring to the table.
How the Math Works
Rather than a single "2%–5% of price" line, the estimator sums four independent buckets exactly the way a Closing Disclosure does:
Lender Origination = Loan Amount × Origination %
This one runs on the loan, not the price, because lenders price it as a percent of the amount they are lending.
Title & Settlement = Title Fee (fixed)
Title insurance and the settlement agent are a flat fee, not a percentage.
Escrow & Prepaids = (Annual Property Tax + Annual Insurance) ÷ 12 × Months Collected
Lenders collect a cushion of future tax and insurance bills at closing; the bucket scales with the monthly bill times the number of months.
Recording, Transfer & Other = Home Price × Other Closing Costs %
The remaining settlement line items — recording, transfer tax, attorney — run on the purchase price.
Total Closing Costs = Lender Origination + Title & Settlement + Escrow & Prepaids + Recording, Transfer & Other
Cash to Close = Down Payment + Total Closing Costs
For a $400,000 home with 20% down, a 1% origination fee, a $2,500 title fee, 3 months of escrow on a $4,800 tax bill and $1,200 insurance, and 2% other costs: the loan is $320,000, origination is $3,200, escrow prepaids are (4,800 + 1,200) ÷ 12 × 3 = $1,500, and other costs are $8,000. Total closing costs are $3,200 + $2,500 + $1,500 + $8,000 = $15,200, and cash to close is $80,000 + $15,200 = $95,200.
What Actually Drives the Bill
Two structural facts matter most:
- Origination rides on the loan, not the price. A bigger down payment shrinks the loan and therefore shrinks the lender origination fee, even though the price is the same.
- State-level transfer tax and title fees are the biggest swing factors. States like New York, Texas, and Delaware carry much higher title and transfer charges than Colorado or California. The exact schedule is a lookup table, not a formula — this calculator uses your inputs to absorb that variation.
Examples
Example 1 — A standard $400,000 purchase. 20% down, 1% origination, $2,500 title, 3 months escrow, $4,800 tax, $1,200 insurance, 2% other. Down payment $80,000; loan $320,000; origination $3,200; title $2,500; escrow $1,500; other $8,000. Total closing costs $15,200, cash to close $95,200.
Example 2 — A low-down-payment $250,000 condo. 10% down, 1% origination, $2,000 title, 2 months escrow, $3,000 tax, $900 insurance, 2% other. Down payment $25,000; loan $225,000; origination $2,250; title $2,000; escrow $650; other $5,000. Total closing costs $9,900, cash to close $34,900.
Example 3 — A $1.2M luxury home. 25% down, 0.75% origination, $4,500 title, 6 months escrow, $14,400 tax, $3,000 insurance, 1.5% other. Down payment $300,000; loan $900,000; origination $6,750; title $4,500; escrow $8,700; other $18,000. Total closing costs $37,950, cash to close $337,950.
FAQ
How much are closing costs on a $400,000 house?
Typically $8,000–$20,000, or about 2%–5% of the price. With the defaults above (1% origination, $2,500 title, 3 months escrow, 2% other), the estimate lands around $15,200 — split into lender, title, escrow, and other buckets.
Who pays closing costs, buyer or seller?
Both. Buyers typically cover origination, escrow, title insurance, and recording. Sellers usually pay the real-estate agent commission and sometimes a transfer tax. In competitive markets, buyers can negotiate a seller credit toward closing costs.
Can I roll closing costs into my mortgage?
Yes, but only on certain loan products (FHA, VA, and some "no-closing-cost" refinances). Rolling them in raises your loan balance and total interest, and it is usually cheaper to pay them upfront unless the lender offers a below-market rate to offset it.
Why are closing costs higher in some states?
State transfer tax, title insurance premium schedules, and attorney requirements vary widely. Delaware, New York, Texas, and Florida tend to run higher; Colorado and Oregon tend to run lower. The exact fee schedule is a state lookup table, not a single national formula.
How much cash do I need to close?
Cash to close is your down payment plus total closing costs. On the $400,000 example above, that is $80,000 + $15,200 = $95,200. Lenders are required to give you a Loan Estimate within three days of application and a Closing Disclosure three days before closing.
Disclaimer
This closing cost calculator from Smekys is provided for informational purposes only and does not constitute lending, legal, or real estate advice. The exact origination rate, title fee, transfer tax, and escrow months depend on your lender, title company, and state of purchase — those schedules are lookup tables the calculator cannot reproduce. Your Loan Estimate and Closing Disclosure are the authoritative numbers. Always compare at least two lender quotes before committing to a mortgage.