What Are Closing Costs?

Closing costs are the fees and expenses you pay at the end of the home-buying process, separate from your down payment. These are the “final details” that make your home purchase official, covering everything from lender fees to title company services.

Most buyers can expect to pay 2–5% of the home’s purchase price in closing costs. For example, if you buy a $300,000 home, your closing costs may range from $6,000 to $15,000.

What’s Included in Closing Costs?

While every transaction is different, here are the most common items included:

1. Loan Origination Fees

What your lender charges to process and create your mortgage.

2. Appraisal Fee

A licensed appraiser determines the value of the home so your lender knows it's worth what you're paying.

3. Home Inspection

Not always mandatory, but highly recommended — especially for first-time buyers. The inspection helps reveal hidden issues that could cost you later.

4. Title Search & Title Insurance

This ensures the home is legally clear to transfer and protects you against disputes over ownership.

5. Prepaid Taxes & Homeowners Insurance

Lenders often require a few months of these upfront to set up your escrow account.

6. Recording Fees

Your county charges these to officially record your property in public records.

7. Survey Fees (in Texas)

In Texas, many transactions require a survey to outline property boundaries.

Do VA Buyers Pay Closing Costs?

If you're a military buyer using a VA loan, great news — the VA limits which closing costs you can be charged. You may still have some costs, but often less than a conventional buyer.

This is especially helpful for PCSing families or first-time military buyers who want to keep more cash on hand.

Can You Reduce or Avoid Closing Costs?

Actually, yes — in several ways:

✔️ Seller Concessions

Depending on the market, sellers may contribute toward your closing costs.

✔️ Lender Credits

Your lender may offer to reduce upfront costs in exchange for a slightly higher interest rate.

✔️ Down Payment Assistance Programs

Texas and San Antonio offer multiple programs that can help with both down payment and closing costs.

✔️ VA Loan Benefits

If you qualify for a VA loan, you may pay fewer closing fees than other buyers.

A good agent (hi, that’s me!) will help you understand what’s negotiable and what assistance you may qualify for.

How Much Should First-Time Buyers Budget for Closing Costs?

A safe rule of thumb:

• Conventional loans: Plan for 3–5% of the purchase price
• FHA loans: Plan for 2–4%
• VA loans: Often 1–3% thanks to reduced fees

Your lender will also give you a Loan Estimate early in the process so you can see your projected costs upfront — no surprises.

Why Understanding Closing Costs Matters

Knowing your closing costs ahead of time helps you:

• Create a realistic budget
• Avoid last-minute stress
• Make confident decisions
• Understand the true cost of buying a home

For first-time buyers, this knowledge is empowering — and often the difference between a smooth closing and a stressful one.

Final Thoughts

Buying your first home is a major milestone, and understanding closing costs is a crucial part of the journey. When you know what to expect, you’re better prepared, more confident, and more in control of your home-buying budget.

If you’re thinking about buying in San Antonio or need help navigating the process, I’d love to guide you. Whether you're a first-time buyer, military family relocating, or renter ready to become a homeowner — you're not alone in this.

Ready to start your home-buying journey? Let’s talk.

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