Closing Costs in Texas
What buyers actually pay at closing in Texas, line by line — plus how to reduce the bill
In this guide:
The Typical 2-5% Range
In Texas, buyer closing costs generally run 2% to 5% of the loan amount. On a $300,000 loan, that's roughly $6,000 to $15,000 paid at the closing table — separate from your down payment. The wide range exists because closing costs include three very different categories: lender fees, third-party fees, and prepaid items like taxes and insurance.
Lender fees vary by lender and loan program. Third-party fees (appraisal, title, survey, recording) are largely market-based and only modestly negotiable. Prepaid items depend entirely on your closing date, your property tax bill, and your homeowners insurance premium — they aren't really fees so much as money you'd owe anyway, just collected upfront.
Quick Estimate
For a rough budget, plan on closing costs equal to about 3% of your loan amount in Texas. On a $250,000 loan, that's about $7,500. Your final number could land anywhere from $5,000 to $12,500 on that loan, depending on the variables above.
Itemized Breakdown of Buyer Closing Costs
Here's what typically appears on a Texas buyer's closing disclosure. Exact amounts vary, but these are the line items to expect.
Lender Fees
- •Origination/processing/underwriting fees: Typically a few hundred to $1,500 combined, sometimes expressed as a percentage of the loan
- •Discount points (optional): 1 point = 1% of loan amount, used to buy down your rate
- •Credit report fee: $50-$100
Third-Party Services
- •Appraisal: Typically $400-$700
- •Survey: $400-$600 (Texas-specific; sometimes paid by seller)
- •Pest/wood-destroying insect inspection: $75-$150 if required
- •Flood certification: Usually under $25
Title and Recording
- •Lender's title insurance policy: Set by promulgated state rates, based on loan amount
- •Title company escrow/closing fee: A few hundred dollars
- •Recording fees: $100-$300 paid to the county
Prepaid Items and Escrow Setup
- •Homeowners insurance: First full year paid upfront
- •Property tax escrow: Typically 2-6 months of taxes deposited into escrow at closing
- •Prepaid interest: Interest from your closing date through the end of the month
- •Insurance escrow: 2-3 months of homeowners insurance into escrow
Today's Mortgage Rates
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Conventional
FHA
VA
USDA
Jumbo
📊 Source: St. Louis Federal Reserve
Who Pays What in a Texas Closing
In Texas, certain costs are customarily paid by the seller and others by the buyer, though almost everything is technically negotiable in the contract.
Customarily Paid by Buyer
Lender fees, appraisal, lender's title insurance policy, recording fees for the deed of trust, prepaid taxes and insurance, escrow setup, and any inspections the buyer orders.
Customarily Paid by Seller
Real estate agent commissions, owner's title insurance policy (a Texas custom that benefits buyers), property taxes prorated through closing, any HOA transfer fees, and often the survey if one is needed and the seller can't produce a recent existing one.
Seller Concessions
Buyers can negotiate for the seller to pay a portion of their closing costs as part of the offer. This is one of the most common ways to reduce out-of-pocket cash at closing — particularly in slower markets where sellers are motivated.
Texas Title Insurance: Promulgated Rates
Texas is one of a small handful of states where title insurance rates are set — "promulgated" — by the state government rather than negotiated between title companies. The Texas Department of Insurance publishes the rate schedule, and every title company in the state must charge the same premium for the same policy.
That means you can't shop title insurance premiums in Texas the way you can in other states. What you can shop are the related fees — escrow/closing fees, document prep fees, courier fees, and so on — which vary by title company.
The owner's title insurance policy is a one-time premium paid at closing that protects you for as long as you own the property. It's genuinely valuable, and in Texas the seller customarily pays for it.
How to Reduce Closing Costs
Negotiate Seller Concessions
Ask the seller to pay 2-3% of the purchase price toward your closing costs in your offer. The maximum allowed varies by loan program (conventional 3-9%, FHA 6%, VA 4% plus customary costs, USDA 6%). This is often the single biggest lever a buyer has.
Take a Lender Credit
You can accept a slightly higher interest rate in exchange for the lender paying your closing costs — sometimes called "rebate pricing." The math works in your favor if you plan to refinance or sell within a few years; if you plan to keep the loan long-term, paying costs upfront is usually cheaper.
Shop Lender and Title Fees
Get Loan Estimates from multiple lenders within a 14-45 day window so it counts as a single credit pull. Compare origination fees, processing fees, and the lender credit/discount points trade-off carefully.
Close Late in the Month
Prepaid interest is calculated from your closing date through the last day of the month. Closing on the 28th instead of the 5th can save several hundred dollars in upfront interest.
Use Down Payment Assistance Programs
Many Texas DPA programs (TSAHC, TDHCA, and city/county options) can be used for closing costs as well as the down payment. Worth asking about even if you don't need help with the down payment itself.
Frequently Asked Questions
How much are closing costs in Texas?
Closing costs for buyers in Texas typically run 2-5% of the loan amount. On a $300,000 loan, that's roughly $6,000-$15,000. The range is wide because it depends on the loan program, the lender's fees, the property's tax rate, prepaid escrow amounts, and any title-related charges.
Who pays closing costs in Texas?
Both the buyer and seller pay closing costs in Texas. Buyers cover lender fees, the appraisal, title insurance for the lender, prepaid taxes and insurance, and escrow setup. Sellers typically cover the owner's title insurance policy, real estate commissions, any agreed-upon repairs, and a portion of property taxes through the closing date. Buyers can sometimes negotiate seller concessions to cover part of their costs.
Can closing costs be rolled into the loan?
On a purchase, you generally cannot roll closing costs directly into the loan amount on conventional or FHA loans, but you can use a lender credit (where you accept a slightly higher interest rate in exchange for the lender paying your costs) or seller concessions to cover them. On a refinance, closing costs can typically be financed into the new loan.
What is title insurance in Texas?
Title insurance protects against losses from defects in the property title — things like undisclosed liens, errors in public records, or ownership disputes. There are two policies: a lender's policy (required, paid by the buyer) and an owner's policy (optional but strongly recommended, customarily paid by the seller in Texas). Title insurance rates in Texas are regulated and promulgated by the state, so they don't vary between title companies.
Can the seller pay closing costs in Texas?
Yes. Sellers can pay a portion of the buyer's closing costs through seller concessions, also called seller-paid costs. The maximum varies by loan program: conventional loans typically allow 3-9% depending on down payment and occupancy, FHA allows up to 6%, VA loans allow up to 4% in concessions plus customary closing costs, and USDA allows up to 6%. These limits apply to the lesser of the sales price or appraised value.
How can I reduce closing costs?
Several strategies work. Negotiate seller concessions in your offer. Take a lender credit in exchange for a slightly higher rate if you don't plan to keep the loan long. Shop your title insurance — though Texas has promulgated rates, related fees like escrow and recording can vary. Ask the lender to waive or reduce origination and processing fees. And review the Loan Estimate carefully against the Closing Disclosure to catch errors.
What is included in closing costs?
Typical buyer closing costs include the loan origination fee, appraisal fee ($400-$700), credit report, lender's title insurance, recording fees, survey (often $400-$600), prepaid homeowners insurance (usually a full year), prepaid property taxes (a few months into escrow), prepaid interest from closing to month-end, and any discount points if you choose to buy down your rate.
Are closing costs tax deductible in Texas?
Some closing costs are tax deductible in the year you buy the home, including mortgage interest paid at closing and any discount points (under certain conditions). Property taxes paid at closing are also generally deductible. Most other costs — title insurance, appraisal, recording fees — are not directly deductible but are added to your cost basis, which can reduce capital gains when you sell.
Get an Itemized Closing Cost Estimate
A Raider Mortgage advisor can give you a Loan Estimate that breaks down every dollar you'll pay at closing — usually within 24 hours of applying.