What Closing Costs and Fees, and How Much Down Payment, Should I Expect on This Loan?
Closing costs commonly run 2% to 5% of the purchase price, or of the loan amount on a refinance. The minimum down payment ranges from 0% on VA and USDA loans to 3% or 3.5% on many conventional and FHA loans. Whether you pay the costs in cash, get a credit for them or roll them into the loan depends on whether you're buying, refinancing or borrowing against your equity.
Last updated September 29, 2026What goes into closing costs?
Lender fees (origination, underwriting and processing), the appraisal, the credit report, title and escrow fees, and on a purchase, any state or local recording and transfer taxes. The total moves with your loan size, your state and whether you pay points for a lower rate. Your Loan Estimate lists every charge for your loan, so compare those line by line rather than relying on a typical range.
Do I pay closing costs in cash, or can they go into the loan?
- Buying a home: you generally pay them at closing along with your down payment, though a seller concession can cover some or all of them.
- Refinancing or taking out a home equity loan: the costs can often be rolled into the new loan, so you may not need cash up front.
- A HELOC or home equity loan instead of a full refinance: a second lien usually costs less to close than a new first mortgage.
- Paying points: points raise your costs at closing in exchange for a lower rate; skipping them keeps costs down and the rate higher.
Government program fees, like the VA funding fee, FHA's upfront mortgage insurance premium and the USDA guarantee fee, can usually be financed into the loan.
How much down payment do I need?
It depends on the program. VA loans allow 0% down for eligible borrowers, and USDA loans allow 0% down for eligible buyers in eligible rural and suburban areas. Conventional loans can go as low as 3% down, and FHA loans as low as 3.5% with qualifying credit. Your loan officer can tell you which minimum fits your situation.
How can I bring less cash to closing?
A seller can pay part of your closing costs through concessions, also called interested-party contributions. Those are capped, and the cap depends on the loan type and, on conventional loans, your loan-to-value. Down payment assistance programs from state and local agencies can also cut what you need at closing.
| Closing costs | Commonly 2% to 5% of the price or loan amount |
|---|---|
| Minimum down payment, VA and USDA | 0% for eligible borrowers |
| Minimum down payment, conventional | As low as 3% |
| Minimum down payment, FHA | As low as 3.5% |
| Seller concession cap, conventional, above 90% loan-to-value | 3% of the sales price |
| Seller concession cap, conventional, 75% to 90% loan-to-value | 6% |
| Seller concession cap, conventional, 75% or less | 9% |
| Seller concession cap, FHA or USDA | 6% |
| VA concession cap | 4% of the appraised value, not counting standard closing costs |
Related questions
Sources
- https://www.consumerfinance.gov/ask-cfpb/what-fees-or-charges-are-paid-when-closing-on-a-mortgage-and-who-pays-them-en-1845/
- https://www.consumerfinance.gov/ask-cfpb/what-are-closing-costs-en-1845/
- https://www.consumerfinance.gov/owning-a-home/loan-estimate/
- https://www.consumerfinance.gov/owning-a-home/prepare/figure-out-how-much-you-want-to-spend/
- https://www.consumerfinance.gov/ask-cfpb/what-are-mortgage-points-en-136/
- https://www.usatoday.com/story/money/personalfinance/real-estate/2026/07/09/closing-costs-2025-homebuyers/90854987007/
- https://www.nerdwallet.com/mortgages/learn/home-equity-loan-vs-cash-out-refinance
- https://themortgagereports.com/94714/heloc-vs-cash-out-refinance
- https://www.bankrate.com/mortgages/what-are-closing-costs/
- https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/
- https://www.fha.com/fha_article?id=516
- https://singlefamily.fanniemae.com/originating-underwriting/mortgage-products/97-loan-value-options
- https://selling-guide.fanniemae.com/sel/b3-4.1-02/interested-party-contributions-ipcs
- https://www.fha.com/fha_article?id=324
- https://www.hud.gov/helping-americans/loans
- https://www.rd.usda.gov/files/3555-1chapter06.pdf
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.