closing costs in california


When closing a real estate transaction there will be costs associated with the transaction outside of just the down payment amount.

Below is a list of potential closing costs to be aware of for buyers and sellers…

Keep in mind that like most things in Real Estate, “who pays for what” is all negotiable.


Closing Costs in California

Outlined Are All The Costs of Buying and Selling Real Estate In California. Image Courtesy Steven Depolo

Buyer’s Closing Costs

Buyers in California should expect to pay approximately 1-3% in closing costs on a purchase.

Those costs can include…

Loan Origination Fee: Generally around 1% of the loan amount. Paid to the lender for preparing the loan.

Points: Each point is equal to 1% of the loan amount. Points buy down the interest rate typically by 0.25% per point. They are tax-deductible.

Application Fee: Paid to the lender or the broker to check credit and process the initial loan application.

Escrow Fee: Paid to the escrow company at closing.

Appraisal Fee: Paid to the appraiser who determines the value of the property.

Title Search an Examination Fee: Pays for the lender to research the property’s title to find out if there are liens and who the rightful owner of the property is.

Inspection Fee: Not part of closing costs, this optional service is provided by a licensed

Real Estate Closing Costs

home inspector. An inspection determines if the property is in good repair prior to the sale.

Remember: In addition to the list above, home buyers have to come up with money for the down payment on the mortgage, pro-rated property taxes, homeowner’s insurance and when applicable, private mortgage insurance.

Depending on where you get your loan, different fees may be assessed. Get a “good faith estimate” for a loan prior to closing for full disclosure of all applicable fees. Compare fees between lenders to get the best deal. If you would like help connecting with a great local lender contact us.


Seller’s Costs


Sellers in California should expect to pay approximately 5-9% in closing costs on the sale of a property.

Those costs can include…

Broker’s Commission: The largest expense when selling a home, commissions paid to the realtor(s) or real estate broker are typically around 6% of the sales price (3% paid to the buyer’s broker and 3% paid to the seller’s broker).

Commissions are negotiated by the sales agent but are generally split evenly with the buyer’s agent.

Broker commissions can be avoided by selling the property “for sale by owner,” but this strategy can translate into lower sales prices and longer time on the market in some cases.

Escrow Fee: Paid to the escrow company at closing.

Attorney Fee (if applicable): This is paid to the attorney who represents the seller at the time of closing.

Other Closing Costs: Title insurance and document preparation fees are often paid by the seller at closing. Sellers may have to pay more of the closing costs if that is part of the purchase agreement.

Other Negotiated Fees: Additional seller concessions such as home warranty fees or points paid towards the buyer’s mortgage interest rate may also be a part of the purchase agreement.

Sellers may also have to pay a portion of the property taxes, prorated for how long they have occupied the property in the tax year.


If you have questions on this or any part of the Real Estate Process…


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(all data current as of 1/16/2021)

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