Closing costs are the one-time charges to finish a home purchase and the mortgage that pays for it. They cover the lender's fees, the appraisal, title insurance, the settlement agent, recording the deed and mortgage at the county, and Florida's taxes on the new loan. Prepaids, such as the first year of insurance and the escrow deposit, are collected at the same table but counted as a separate group.
What counts as closing costs
| Group | Examples | Who sets the price |
|---|---|---|
| Lender charges | Origination, underwriting, discount points | The lender |
| Third-party services | Appraisal, credit report, survey, title search, settlement fee | Each provider |
| Title insurance | Lender's policy, and often an owner's policy | Florida's state-set premium rates |
| Government charges | Recording fees, doc stamps on the note, intangible tax | Florida law and the county |
Florida taxes a new mortgage twice. The documentary stamp tax on the note is 35 cents per $100 of the loan, and the nonrecurring intangible tax is 0.2% of the loan. The deed carries its own doc stamp tax of 70 cents per $100 of the price (60 cents in Miami-Dade on a single-family home), which the seller pays under most Florida purchase contracts.
A Conventional example on a $300,000 home
A first-time buyer puts 3% down on a $300,000 single-family home, a Conventional loan of $291,000.
- Doc stamps on the note: $291,000 ÷ 100 = 2,910 × $0.35 = $1,018.50
- Intangible tax: $291,000 × 0.2% = $582.00
- Lender, appraisal, title, settlement and recording charges (estimate): $5,200.00
- Total closing costs: $6,800.50
With less than 10% down, Fannie Mae lets the seller contribute up to 3% of the price, which is $9,000 here. That pays all $6,800.50 of closing costs and leaves $2,199.50 toward prepaids. The buyer's own cash shrinks to the $9,000 down payment plus whatever prepaids the credit doesn't reach, and a gift from family can cover those.
Who can pay closing costs, by program
- FHA: seller credits up to 6% of the price, plus gifts from family, an employer or a close friend.
- VA: the seller can pay all of your normal closing costs, plus concessions up to 4% of the reasonable value.
- Conventional: seller contributions of 3%, 6% or 9% of the price, depending on the down payment.
- USDA: seller contributions up to 6%, and closing costs can go into the loan when the appraisal comes in above the price.
A lender credit is one more route: you take a slightly higher rate and the lender pays part of the costs. Every program also lets the credit cover only actual costs, so the request should match the figures on your Loan Estimate.
Run your price through the cash to close calculator to see closing costs, prepaids and credits in one total. Before you write an offer, call AAA Capital Funding at 888-601-8344 so the seller credit you ask for matches what your closing will cost.