Closing Costs in Texas: Who Pays What
Closing costs in Texas follow local custom more than law, which means almost every line on the list is negotiable if you know it's there. Most buyers don't.
What the buyer customarily pays
- Lender fees — origination, underwriting, processing. Varies widely between lenders; this is the section worth comparing.
- Appraisal — ordered through an independent management company.
- Credit report and verification fees — small, fixed.
- Lender's title policy — required by the lender; far cheaper than the owner's policy.
- Survey — sometimes provided by the seller if an existing survey is acceptable. Always ask before ordering a new one.
- Recording fees and transfer charges — set by the county.
- Prepaids and escrows — a year of insurance upfront, daily interest to month end, and several months of taxes and insurance to fund the escrow account.
What the seller customarily pays
- Owner's title policy — in most of Dallas–Fort Worth this is customarily a seller cost, and in Texas title rates are promulgated, so it doesn't vary by title company.
- Their share of prorated property taxes — through the closing date.
- Any commission obligations — per their listing agreement.
- Escrow and document fees — commonly split.
"Customarily" is the operative word. Every one of these can be moved by contract, and in a slower market they routinely are.
What to budget
For planning, budget roughly 3–5% of the purchase price for buyer closing costs, prepaids and escrow funding combined, on top of your down payment. The escrow and prepaid portion tends to be the larger half in Texas, because property taxes here are high and a full year of insurance is collected upfront.
The calculator on this site itemizes all of it against your specific price, down payment, and loan program.
Where the negotiating room actually is
- Lender fees — the one section genuinely subject to competition. Compare Loan Estimates side by side, not rate quotes.
- Homeowner's insurance — shop it. Same house, same coverage, materially different premiums.
- The survey — an existing survey with a seller affidavit is often accepted, saving several hundred dollars.
- Closing date — closing late in the month cuts prepaid daily interest.
- Seller credits — the largest lever available, capped by your program's contribution ceiling.
- Lender credits — accept a slightly higher rate in exchange for the lender covering costs.
Frequently asked
How much are closing costs in Texas?
For a buyer, roughly 3–5% of the purchase price including prepaids and escrow funding is a reasonable planning figure. On a $400,000 purchase that's commonly $12,000–$20,000 beyond the down payment, with the escrow and prepaid portion often exceeding the fees.
Who pays the title policy in Texas?
By custom in most of Dallas–Fort Worth, the seller pays for the owner's title policy and the buyer pays for the lender's policy. Title insurance rates in Texas are promulgated by the state, so the premium is the same regardless of which title company closes the file.
Are closing costs negotiable?
Lender fees are genuinely competitive and worth comparing. Third-party costs like appraisal and recording are largely fixed. Who pays which line, however, is entirely negotiable between buyer and seller within your loan program's contribution limits.
Can closing costs be rolled into the loan?
Generally not on a purchase, with the exception of FHA's upfront mortgage insurance premium and the VA funding fee, both of which are routinely financed. What can happen instead is a lender credit — a higher rate in exchange for the lender paying costs — which achieves a similar result.
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