What are typical total closing costs as a percentage of the home's purchase price?

Buyers typically pay closing costs of 2% to 5% of the loan amount or purchase price. These include lender fees (origination, underwriting, processing), third-party fees (title search, title insurance, appraisal, survey, attorney), prepaid items (homeowners insurance, property tax escrow, prepaid interest), and government fees (recording fees, transfer taxes). On a $400,000 home, buyers should budget $8,000 to $20,000 in closing costs in addition to their down payment. Some lenders offer 'no-closing-cost' loans that roll these fees into a higher interest rate.