How Much are Closing Costs? Plus How to Estimate Yours

If you’re budgeting to buy a home, you’re probably thinking about down payments, monthly mortgage costs, and HOA fees. But don’t overlook one of the most common surprises for first-time homebuyers: closing costs.

These are the fees and services required to finalize your home purchase, and they typically add up to 2% to 5% of the home’s purchase price. That means on a $1,000,000 home, you could be looking at $20,000 to $50,000 in additional expenses on top of your down payment.

Let’s break down what closing costs actually include, how much to budget, and how working with a flat-fee brokerage like TurboHome can keep more money in your pocket.

What Are Closing Costs?

Closing costs are a collection of fees paid to various parties involved in your transaction. These can include:

• Loan origination fees (if financing): Charged by your lender for processing and approving your mortgage. This fee is usually 0.5%–1% of the loan amount.
• Appraisal: A third-party appraiser determines the fair market value of the home to ensure the lender isn’t overfinancing. Expect $300–$600.
• Inspections (if not completed by the seller): Professional inspectors check for structural issues, safety hazards, and pest damage. Costs range from $300–$1,500 per inspection.
• Credit report fees: Lenders pull your credit report to evaluate your borrowing history and determine your loan eligibility. This covers the cost charged by credit bureaus. It’s usually $25–$50 per borrower.
• Title search and insurance: Ensures the property has no legal claims or liens against it. Title insurance protects you and the lender if any issues arise later.
• Escrow fees: Paid to the neutral third-party (escrow company) that manages funds and documents until the sale is finalized. Often split between buyer and seller.
• Recording fees: Charged by the county to officially record the property transfer in public records. Usually $100–$500, depending on the county.
• Prepaid property taxes and homeowners insurance
• Misc: Includes notary services, courier charges, and wire transfer fees usually $100–$300 in total.
• HOA dues and prorated utilities (if applicable)

You’ll receive a detailed breakdown of these costs in your Loan Estimate and Closing Disclosure, but it’s smart to understand the general range ahead of time.

How Much Are Closing Costs in California?

In competitive markets like California, closing costs typically range from 2% to 3.5% of the purchase price. Here’s what that might look like:

• $750,000 home: $15,000 to $26,250
• $1,000,000 home: $20,000 to $35,000
• $1,500,000 home: $30,000 to $52,500

Factors that influence closing costs include:

• Your lender and loan type
• Property location
• Whether you’re using a buyer’s agent who charges a traditional commission

How TurboHome Helps You Save

When you buy a home using TurboHome, our Agents give you the real estate commission paid by the seller! You can choose to allocate this commission to reducing your closing costs or even receiving a rebate! Many of our clients pay $0 in closing costs due to our flat fee pricing model!

Final Tips for Managing Closing Costs

• Get a quote early: Ask your lender for a Loan Estimate to anticipate fees.
• Negotiate credits: In some cases, sellers may agree to cover part of your closing costs.
• Budget above the minimum: Plan for 3% to 5% to avoid surprises.
• Work with a transparent, tech-savvy brokerage such as TurboHome.

Buying a home is one of the biggest financial decisions you'll make, and closing costs are part of the equation. TurboHome helps you navigate every step with confidence, clarity, and real savings.

Ready to start your homebuying journey? Reach out to our team at TurboHome.com.