Texas buyer closing costs
What a buyer brings to closing in Texas: lender fees, title, prepaids and the down payment, on a typical financed purchase.
- Closing costs on $300,000
- About $5,409
- Owner's title policy
- Seller pays
- Cash to close, 20% down
- About $66,791
Example: $300,000 purchase in Texas
$300,000 is close to the typical Texas home value. With a $240,000 conventional loan, closing costs come to about $5,409 (1.8% of the price) and prepaids to about $4,075.
| Line | Buyer |
|---|---|
| Down payment (20%) | $60,000 |
| Lender's title insurance policy | $100 |
| Lender-required endorsements | $125 |
| Settlement / closing fee | $450 |
| Survey | $500 |
| Deed recording fee | $34 |
| Mortgage recording fee | $90 |
| Loan origination (1%) | $2,400 |
| Appraisal | $550 |
| Credit report | $60 |
| Underwriting / processing | $995 |
| Flood certification | $25 |
| Tax service fee | $80 |
| Closing costs | $5,409 |
| Prepaid interest | $1,324.93 |
| Homeowner's insurance (12 months) | $1,200 |
| Insurance escrow reserve (2 mo) | $200 |
| Property tax escrow reserve (3 mo) | $1,350 |
| Prepaids and escrow reserves | $4,074.93 |
| Property tax credit from seller | −$2,692.60 |
| Estimated cash to close | $66,791.33 |
Run it with your own numbers: choose the county, loan type, rate and closing date.
What else changes a Texas buyer's costs
- Texas has no real estate transfer tax, so the largest seller costs after commission are the owner's title policy, the seller's share of escrow, and the property tax proration.
- Title insurance premiums in Texas are set by the Texas Department of Insurance, so the owner's policy costs the same at every title company. The seller customarily pays it.
- Property taxes are billed in October and due by January 31 of the following year. At closing the seller credits the buyer for taxes from January 1 through closing. The TREC contract prorates on the current year's taxes when known and has the parties adjust once the actual bill comes out.
Texas buyer questions
How much are buyer closing costs in Texas?
On a $300,000 home with 20% down, a Texas buyer pays about $5,409 in closing costs (1.8% of the price), plus about $4,075 of prepaid insurance, interest and escrow reserves. Estimated cash to close, including the $60,000 down payment, is about $66,791.
Does the buyer pay transfer tax in Texas?
No. Texas has no real estate transfer tax.
Who pays for the owner's title policy in Texas?
Seller customarily pays the owner's policy (TREC contract paragraph 6).
What is the difference between closing costs and cash to close?
Closing costs are the fees and taxes for the loan, title and recording. Cash to close adds the down payment and prepaid items such as insurance, interest and escrow reserves, then subtracts credits such as the seller's property tax proration and the earnest money already deposited.
Give your buyer a cash-to-close estimate.
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