Closing costs versus cash to close
What closing costs can include
Common categories include lender charges, appraisal and title services, government recording and transfer charges, prepaid interest, homeowners insurance, and initial escrow funding.
The CFPB says closing costs, excluding the down payment, typically range from 2% to 5% of the purchase price. The calculator starts at 3% and lets you replace it with a written estimate.
Why cash to close is not just down payment plus fees
Cash to close can reflect earnest money already paid and applied to the purchase, eligible seller credits, lender credits, and other adjustments. This simplified estimate applies the deposit to cash due and caps entered credits at estimated closing costs, so credits never fund the down payment here.
A credit does not necessarily make a cost free, and not every charge is always eligible. Seller credits are subject to contract and loan rules, while a lender credit can be connected to a higher rate. The written Loan Estimate controls.
When to replace the percentage estimate
After applying, use the Estimated Cash to Close on the Loan Estimate. Before closing, compare the final Closing Costs and Cash to Close on the Closing Disclosure. Do not subtract a credit again when it is already included in a written total.