Closing costs in real estate

Investors who underestimate closing costs destroy their margins before they even own the property. A $200,000 deal with 4% in closing costs adds $8,000 to your all-in number—enough to flip a profitable deal into a breakeven.

Typical buyer closing costs

• Loan origination fee: 0.5–1% of loan amount
• Appraisal: $400–$700
• Credit report: $30–$50
• Title search and insurance: $500–$1,500
• Survey: $300–$800
• Recording fees: $100–$400
• Inspections: $300–$800
• Prepaid taxes and insurance: 2–6 months
• Points: Optional, 1 point = 1% of loan

Typical seller closing costs

• Agent commissions: 5–6% of sale price (if listed)
• Transfer taxes: Varies by state/county
• Title insurance (owner's policy): $500–$1,500
• Attorney fees: $500–$1,500 (if required)
• Buyer concessions: Negotiable, up to 3–6%
• Outstanding liens or HOA fees: Must be paid at closing

How investors manage closing costs

• Negotiate seller concessions. Ask the seller to cover a portion of buyer closing costs, especially in buyer-friendly markets.
• Shop lenders. Origination fees and points vary significantly. Get quotes from at least three lenders.
• Use title company relationships. Volume discounts for repeat investors can reduce title costs.
• Cash purchases. Eliminate loan-related fees entirely—big savings on lower-priced deals.

Factoring closing costs into OffMarket Deck deals

When you underwrite a deal from OffMarket Deck, add estimated closing costs to your all-in projection before calculating profit. Use the MAO formula and include 3–4% for financed deals or 1–2% for cash. Small adjustments here prevent large surprises at the closing table.