In California, closing costs are well above the national average. Expect to cough up between 0.98% and 1.15% of your total home purchase price — though the seller may be willing to sweeten the deal with a concession.
Average closing costs in California
In California, the average home sells for $600,000 to $700,000. If you find a property within that price range, expect to pay between $6,120 and $7,140 — before taxes — in closing costs. These charges cover your inspection, appraisal and origination costs, as well as title insurance and courier fees. Depending on the type of property and how you’re paying for it, you may also need to pony up for mortgage insurance, flood certification, HOA or condo fees. Some of these are negotiable, but the taxes are set in stone. California is subject to property and transfer taxes, though property taxes have been capped at 1% of the purchase price since 1978. Our averages are based on sample data. Closing costs can vary based on your lender, the size and type of your loan and even your credit score.
How do closing costs in California compare nationally?
California’s closing costs are the sixth highest in the country, lagging only behind DC, New York, Maryland, Delaware and Pennsylvania. This rank is not surprising, given the expensive real estate and the fact that houses and land lots make up the majority of the market.
Who pays closing costs in California?
Closing costs are split between the buyer and the seller in the Golden State, though the buyer absorbs most of them. Your rates reflect your lender and the market, as well as the type, location and price of the property.
Buyers
Closing attorney: Varies
Title search: $500–$1,000
Title insurance: $1,200–$2,800
Appraisal fee: $200–$600
Property inspection fee: $300–$800
Recording fee: $8.50–$10 a page
Origination fee: $800–$950
Points (optional): 1% of the loan amount
Surveying fee: $500–$900 based on size of land
Settlement fee: $400–$700
Property tax: Prorated at closing
Condo or HOA fees: Prorated at closing, if applicable
Flood certification: $11
Credit report: $25
Mortgage recording or deed of trust: $35
Homeowners insurance: Varies
Hazard insurance: Varies, if applicable
Mortgage insurance: Up to 1% of mortgage amount, if applicable
Archive and courier fee: $50–$120
Miscellaneous condo fees: Varies
Mello-Roos CFD taxes: Varies, if applicable
Sellers
Broker fees: Typically 6% of sales price
Own attorney: Varies
Transfer tax: $1.10 per $1,000 of purchase price
Property tax: Prorated at closing, if applicable
Document preparation fee: $150–$250
Recording fees: $125
Escrow fees: Varies
Mortgage payoff: Subject to loan balance
Courier and wire transfer fee: $50–$150
Home warranty fee: Varies, if applicable
Condo or HOA fees: Prorated at closing, if applicable
Miscellaneous condo fees: Varies
What are points?
In California, you can pay interest up front at closing in the form of discount points. Many buyers opt into points to score a lower interest rate on their mortgage. One point equals 1% of the loan amount. So, for a $250,000 loan, you’d pay an $2,500 in points at closing.
What to know about buying or selling a property in California
The Golden State stands out for its unique settlement process. When you buy or sell a property in California, you’ll need to keep a few rules and guidelines in mind.
California law doesn’t require the buyer and seller to physically meet at the closing table.
You might not ever meet the other party face to face. Buyers and sellers often leave the communication up to their real estate brokers and agents, who ask questions and negotiate on their clients’ behalf. Once the terms of the sale and escrow are finalized, you get the keys to your new home.
Unlike in most states, buyers and sellers can be represented by the same real estate broker.
Your broker can be what’s called a dual agent, or — in the case of two agents working for the same broker — a dual-agency partnership. If you agree, the buyer and seller must consent to the arrangement in writing. You’ll complete a Disclosure Regarding Real Estate Agency Relationships form, which identifies the brokers and agents involved in the real estate transaction.
Depending on where you live, you might need to pay Mello-Roos taxes.
Under the Community Facilities Act, Mello-Roos taxes are used to fund improvements to local infrastructure. They can be used to build or repair streets, sewers and sanitation systems, pay for police protection and cover the maintenance of parks, schools and other facilities. Before buying a home, ask whether the property is located in a Mello-Roos Community Facilities District. If it is, ask about the expected special-tax payment due each year, and factor it into your budget.
Consider earthquake insurance.
California is prone to earthquakes. If you have a mortgage, you must buy homeowners insurance — but your policy won’t cover earthquake damage, except in the case of fire. Those policies are sold separately, and they’re optional. When you buy homeowners insurance, the company must offer to sell you earthquake insurance. The written offer must lay out the limits, deductible and premiums you’d pay. And you have 30 days to accept the offer.
Compare mortgage lenders
Compare top brands by home loan type, state availability and credit score. Select See rates to provide the lender with basic property and financial details for personalized rates.
Disclaimer: The partners on Finder's mortgage comparison tables are sorted in alphabetical order.
California’s closing costs are among the highest in the country: Expect to pay 0.98% to 1.15% of the sales price. There’s room to negotiate some fees, while others are fixed. With closing costs so high, it’s worth it to compare mortgage lenders to find the most affordable for your needs.
Frequently asked questions
Do I need a lawyer to purchase a home in California?
No. You don’t need to hire a lawyer to represent your interests at closing in California. But purchasing property can be a complex transaction. Many buyers choose to engage an experienced lawyer to help them through the process.
What is Proposition 13, and how does it affect property taxes?
In 1978, California voters passed Proposition 13. The measure caps property taxes at 1% of a home’s assessed value at the time of purchase. Prior to this, the property tax rate across the state averaged 3% of a home’s market value.
Why do I have to pay for a credit report?
Before you buy a home, your mortgage lender conducts a hard pull of your credit report to review your credit history and ratio. Your report confirms your creditworthiness and your ability to pay your mortgage, potentially landing you lower rates with solid credit.
Do I get my earnest money back at closing?
Typically, your earnest funds are held in an escrow account managed by the buyer’s real estate agent or title company. At closing, the deposit is either returned to you or deducted from your closing costs.
Katia Iervasi is a lead writer and spokesperson at NerdWallet and a former editor at Finder, specializing in insurance. Her writing and analysis on life, disability and health insurance has been featured in The Washington Post, Forbes, Yahoo, Entrepreneur, Best Company and FT Advisor. She holds a BA in communication from Australia's Griffith University.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Advertiser Disclosure
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
