Buying a home in Raleigh and not sure how much to budget for closing costs? You are not alone. Planning your cash to close is one of the most confusing parts of buying, especially if you are new to North Carolina or purchasing your first home. In this guide, you will learn what closing costs usually include, typical amounts in Wake County, who often pays which fees, how to estimate your total, and smart ways to lower what you bring to the table. Let’s dive in.
Closing costs in Raleigh basics
Most buyers in Raleigh and Wake County should plan for closing costs equal to about 2% to 5% of the home’s purchase price. This range does not include your down payment. The exact number depends on your loan type, the timing of your closing, whether you set up tax and insurance escrows, and whether you receive any seller or lender credits.
You will receive a Loan Estimate within three business days of applying for your mortgage. Closer to your closing date, you will receive a Closing Disclosure at least three business days before you sign. These two documents are the most accurate view of your actual costs.
Why the range varies
- Loan program and rate: Conventional, FHA, VA, or USDA loans can change fees and mortgage insurance.
- Credits and concessions: Seller credits or lender credits can lower your out-of-pocket costs.
- Prepaids and escrows: Funding tax and insurance escrows can add hundreds or thousands based on timing.
- Services you choose: Inspections, surveys, and optional reports affect totals.
Typical buyer fees explained
Below are common line items you may see as a Raleigh buyer. Amounts are typical ranges and can vary.
Loan and lender fees
- Origination or points: Often 0.5% to 1% of the loan amount. This covers underwriting and processing. Sometimes it is a flat fee.
- Underwriting and processing: Often 300 to 1,000 dollars combined.
- Credit report: Usually 25 to 50 dollars.
- Appraisal: Commonly 350 to 700 dollars depending on property type and size.
- Upfront mortgage insurance (if applicable): Some loans require an upfront premium that may be financed or paid at closing.
Who usually pays: You as the buyer. Lender credits or seller concessions can offset some of these.
Title, settlement, and attorney fees
- Title search and exam: The title company or closing attorney searches public records to confirm clear ownership.
- Title insurance: Lender’s policy is typically required when you finance. An owner’s policy protects your equity and is often optional but recommended. Premiums vary by price.
- Settlement or closing fee: Often 300 to 1,500 dollars depending on complexity.
- Closing attorney fee: Often 300 to 800 dollars or more. In North Carolina, an attorney or licensed settlement agent commonly handles closings and recording.
Who usually pays: Buyers typically pay the lender’s policy and many settlement charges. Who pays the owner’s policy varies by market and is negotiable. Confirm local practice with your agent and closing attorney.
Government, recording, and transfer items
- Recording fees: Wake County Register of Deeds charges to record the deed and mortgage. Fees are set by the county and can include per-page charges.
- Transfer taxes: North Carolina generally does not charge a statewide real estate transfer tax like some states. You will still see recording and administrative fees.
Who usually pays: This can be split or negotiated. Mortgage recording often falls to the buyer. Deed recording may be handled by the seller. Confirm in your purchase contract and with your closing attorney.
Prepaids and escrow reserves
- Property taxes: Taxes are prorated based on the closing date. You may also deposit several months of taxes into your escrow account.
- Homeowner’s insurance: Lenders commonly require paying the first year’s premium at closing.
- Private mortgage insurance (if applicable): You may pay a first-month premium or an upfront amount, depending on the program.
- Escrow reserves: Lenders often collect 2 to 3 months of taxes and insurance to start your escrow account.
These items can add several hundred to several thousand dollars depending on the home price, timing, and tax schedule.
Inspections and optional reports
- Home inspection: Often 300 to 600 dollars for a typical single-family home. Larger or older homes can cost more.
- Pest, radon, septic, sewer, or specialty inspections: Often 100 to 500 dollars each.
- Survey (if required or desired): Often 300 to 900 dollars or more.
These are usually paid by the buyer unless negotiated otherwise.
HOA and miscellaneous fees
- HOA transfer or setup fees: Some associations charge transfer fees and prorated dues. Amounts vary.
- Other small items: Flood certification, wire fees, document prep, and couriers are common small line items, often 10 to 200 dollars each.
Who usually pays what in Wake County
Customs can vary by transaction and are negotiable. In Raleigh area deals, buyers typically cover lender-related fees, appraisal, inspections, the lender’s title policy, and settlement charges. The owner’s title policy is negotiable and varies by local practice, so confirm early. Recording fees are sometimes split by document type, but this is set in the contract. Your agent and closing attorney will guide you and can provide a fee quote early in the process.
How to estimate your cash to close
Use this practical formula to budget:
- Cash to close = Down payment + Closing costs + Escrow and prepaid items + Any upfront mortgage insurance − Seller credits − Lender credits − Earnest money already paid.
Request Loan Estimates from at least two lenders and compare their fees, projected escrows, and any credits. Your Closing Disclosure, delivered at least three business days before closing, is the final word on your actual numbers.
Example Raleigh buyer scenarios
Assuming closing costs equal about 3% of the purchase price, here is a quick ballpark:
- 350,000 dollar purchase: about 10,500 dollars in closing costs.
- 450,000 dollar purchase: about 13,500 dollars in closing costs.
- 600,000 dollar purchase: about 18,000 dollars in closing costs.
You will also add your down payment. For example, 5% down on 450,000 dollars is 22,500 dollars. Escrow reserves for taxes and insurance may add roughly 1,000 to 5,000 dollars depending on timing and premiums. Your Loan Estimate will give a clearer picture for your situation.
Common ranges for Raleigh buyers
- Lower range: About 2% to 3% when you receive credits and have minimal prepaids.
- Typical range: About 3% to 4% including standard title and attorney fees, prepaids, and core inspections.
- Higher range: About 4% to 6% when you add many inspections, a survey, higher title premiums, or larger escrow deposits.
Ways to reduce out-of-pocket closing costs
- Ask for seller concessions: You can request the seller cover specific fees or a set dollar amount. Loan rules limit how much sellers can contribute, and it may affect pricing, so discuss strategy with your agent and lender.
- Compare lenders: Get Loan Estimates from at least two lenders and compare origination fees, points, and credits.
- Use lender credits: You might accept a slightly higher interest rate in exchange for a lender credit that lowers your cash to close.
- Shop settlement services where allowed: Title and settlement fees can vary. Your closing attorney can provide quotes.
- Prioritize inspections: Start with core inspections. Add optional tests if results or property condition point to a need.
- Explore assistance programs: State and local programs can help with down payment and closing costs if you qualify.
Tip: Be cautious with offers that advertise “no closing costs.” Often the costs are offset by a higher interest rate. Always compare the long-term impact on your monthly payment and total interest.
Raleigh specifics and what to expect
- Closings handled by attorneys: In North Carolina, closings are commonly handled by an attorney or licensed settlement agent who manages escrow, final figures, and recording.
- County fees and recording: Wake County sets recording charges. Your closing attorney will quote these and include them on your Closing Disclosure.
- Documents and timing: Expect to provide ID, proof of homeowner’s insurance, and funds via cashier’s check or wire. Always verify wire instructions by phone with the closing office using a trusted number.
- TRID timelines: You receive a Loan Estimate within three business days of loan application and a Closing Disclosure at least three business days before closing.
- Assistance options: The North Carolina Housing Finance Agency offers programs for first-time buyers, and Raleigh or Wake County may have periodic offerings. Availability and terms change, so check current guidelines with participating lenders and local housing offices.
Quick buyer checklist
- Get preapproved and request Loan Estimates from at least two lenders.
- Ask your agent for a Wake County closing cost worksheet based on recent local deals.
- Budget 2% to 5% of the price for closing costs, plus down payment and escrows.
- Plan for inspections, appraisal, title insurance, attorney fees, and prepaids.
- Confirm who pays the owner’s title policy in your offer negotiations.
- Verify wire instructions by phone to prevent fraud.
- Review your Closing Disclosure carefully as soon as you receive it.
When you understand the moving parts, closing costs become predictable. With the right plan, you can control what you spend, reduce surprises, and keep your purchase on track. If you want a clear, custom estimate for your price point and loan type in Raleigh or Wake County, reach out. Liza Seymour will walk you through line by line, help you compare lenders, and negotiate credits that make sense for your goals.
FAQs
What are closing costs for a Raleigh home purchase?
- Closing costs are the one-time fees and prepaids you pay at settlement, typically about 2% to 5% of the purchase price, separate from your down payment.
How much should a Wake County first-time buyer budget on a 450,000 dollar home?
- A typical estimate is 3% of the price, or about 13,500 dollars in closing costs, plus your down payment and any escrow reserves for taxes and insurance.
When are closing costs paid by Raleigh buyers?
- They are paid at closing, usually by cashier’s check or wire, with any earnest money already paid credited toward your final cash to close.
Can a seller in Raleigh pay my closing costs?
- Yes, sellers can contribute within loan program limits; the amount is negotiated in your purchase agreement and may affect price and terms.
Do I need a closing attorney for a North Carolina home purchase?
- In North Carolina, closings are typically handled by an attorney or licensed settlement agent who manages escrow, documents, and recording.
How are Wake County property taxes handled at closing?
- Taxes are prorated based on the closing date, and your lender may collect several months of tax escrow to start your escrow account.
