Close-up on Closing Costs
Editor’s Note (Updated 2025): This article has been refreshed to reflect current closing cost guidelines, lender rules, and updated resources for today’s homebuyers.
Understanding Closing Costs When Buying a Home in 2025
When you’re buying a home, you’ll hear the phrase “closing costs” again and again. But what exactly does it include — and how much should you plan to pay? Many homebuyers are unfamiliar with the details, which can make this part of the purchase feel overwhelming. This updated 2025 guide explains what closing costs typically cover, how much they usually are, and how to prepare for them with confidence.
Closing costs vary widely depending on your location, lender, and the age and condition of the home you're purchasing. Even if you’ve bought a home before, your closing costs may look very different if you're purchasing in a new area or moving to a newer or older home.
Common Fees Included in Closing Costs
While every transaction is unique, closing costs often include:
- Credit report fees
- Loan origination fee (charged by the lender for processing your loan)
- Attorney’s fees
- Home inspection fees (if required or requested)
- Discount points (paid to secure a lower interest rate)
- Appraisal fee
- Survey fee (to verify property lines)
- Title insurance (protects the lender if a title issue is discovered)
- Title search fees (background check on property title)
- Escrow deposits for taxes and/or mortgage insurance
- Pest inspection fee
- Recording fee (paid to your county for filing the deed)
- Underwriting fee (covers the cost of evaluating your loan application)
How Much Are Closing Costs?
Most homebuyers can expect to pay between 2% and 5% of the home’s purchase price in closing costs. For example, on a $150,000 home, closing costs typically range from $3,000 to $7,500. Recent national surveys show that the average buyer pays around $3,700.
Your lender is legally required to provide a Loan Estimate within three business days of your loan application. This document outlines your estimated closing costs. Many of these fees can change by up to 10%, so your final closing cost total may vary.
Within 24 hours of closing, your lender must also provide a Closing Disclosure. This document itemizes every fee, charge, and credit related to your mortgage.
Can Closing Costs Be Negotiated?
Yes — in some cases, you can negotiate certain fees. If you see a line item you don’t understand, don’t hesitate to ask your lender or attorney for clarification and whether it is mandatory.
Need Help Understanding Closing Costs?
If you have questions about closing costs or the homebuying process, Ernest Homes is always here to help. Visit us online at ErnestHomes.com, call us at (912) 756-4135, or reach out through our Contact Page. We’re happy to guide you every step of the way as you prepare for your new home.
