When you’re planning to buy a home, it’s easy to focus only on the down payment and monthly mortgage. But there’s another important piece to this home buying puzzle: CLOSING COSTS.

Closing costs typically range between 2–5% of the purchase price, and they cover all the services and fees required to officially transfer the home into your name.

Here’s a breakdown of what’s usually included:

1. Loan & Lender Fees

• Loan origination fee (what your lender charges to process the loan)
• Credit report fee
• Discount points if you choose to buy down your rate

2. Title & Escrow Fees

• Title search & title insurance (protects you and the lender against claims to ownership)
• Escrow or closing agent fee

3. Prepaid Expenses

• Homeowner’s insurance (usually your first year paid up front)
• Property taxes (a portion is collected at closing to start your escrow account)
• Interest that accrues between closing day and your first mortgage payment

4. Other Common Costs

• Appraisal fee
• Survey fee (in some cases)
• HOA transfer fees or other require charges
• Recording fees charged by the county

So How Do Builders Help?

Here’s the exciting part for buyers looking at new construction: many builders offer closing cost incentives. That might mean thousands of dollars in savings — money that would otherwise come straight out of your pocket.

Some builders even partner with preferred lenders and title companies to reduce or completely cover certain fees. This can make a huge difference when you’re deciding whether you can buy now or need to wait.

Other Ways to Lower Your Closing Costs

While builder incentives can make a big difference with new construction, there are also several strategies you can use to reduce closing costs on a resale home purchase as well.

• Shop Your Lender
  Different lenders charge different fees. Even a small difference in origination or underwriting fees can save you hundreds of dollars. Always compare loan estimates before committing.
• Ask the Seller for Concessions
  In some resale transactions, especially if the home has been sitting on the market for a while, you can negotiate for the seller to cover part of your closing costs. This is a common tool we use to make a deal work.
• Check for First-Time Buyer Programs
  The state of Texas offers grants or credits to help with closing costs…and I can connect you with the right lender to see what you may qualify for.
• Time Your Closing Date
  If you close at the end of the month, you’ll owe fewer “prepaid interest” days upfront. This doesn’t lower the total cost of the home, but it can reduce what you bring to the table on closing day a little bit.

Takeaway

Closing costs aren’t scary once you understand what they are — and with the right planning (and possibly builder incentives), they don’t have to hold you back from buying your first home.

If you’re curious what your closing costs might look like on a specific home or community, I’d be happy to walk you through the numbers.