What will you actually pay at the closing table in Washington, DC? If you are buying or selling, the list of fees can feel like a mystery until the final week. You want clear numbers early so you can plan, negotiate, and avoid surprises. In this guide, you will learn who typically pays what in DC, how transfer and recordation taxes affect your bottom line, realistic cost ranges, and the exact steps to get your own figures. Let’s dive in.
DC closing costs at a glance
Closing costs are the one-time fees and taxes due at settlement, separate from a buyer’s down payment. In broad terms, buyers in DC should plan for about 2% to 5% of the purchase price in closing costs, while sellers often spend 6% to 10% of the sale price in total selling costs. Seller totals are dominated by commission in many transactions.
DC’s transfer and recordation taxes can be sizable and may push totals higher. Because DC rules can change, always confirm current rates with the title company and check the DC Office of Tax and Revenue for updates.
Who pays what in DC
Every contract is negotiable, but here is how costs are commonly split in DC practice.
Buyer usually pays
- Lender charges if you finance the purchase. These can include origination or underwriting fees, application and processing fees, and optional discount points if you choose to buy down your rate. Your lender will show these on your Loan Estimate.
- Appraisal fee. Most lenders require an appraisal, typically a few hundred dollars.
- Credit report fee. This is usually a modest line item, often under 100 dollars.
- Mortgage recordation taxes and recording fees. These are tied to the loan and paid when the mortgage is recorded with the DC Recorder of Deeds.
- Lender’s title insurance policy. If you finance, the lender requires this policy. The premium scales with the loan amount.
- Title search, settlement or closing fee, and recording fees. Buyers often pay the title company’s charges for searches, document prep, and recording.
- Prepaid items and escrow reserves. Expect to prepay homeowner’s insurance, initial property tax reserves, and daily interest until your first payment.
- Survey if required. Costs vary by property type and scope.
- Homeowner association or condo fees tied to transfer. Items like move-in fees or association documents may be paid by the buyer or split, depending on the contract.
Seller usually pays
- Real estate commission. In many U.S. markets this is a major line item and often in the 5% to 6% range in total, allocated per listing agreement.
- DC transfer tax. In DC practice the seller commonly pays transfer tax, though it is negotiable in the contract.
- Owner’s title insurance policy. In some DC transactions the seller provides the owner’s policy for the buyer, though this can vary by deal and is negotiable.
- Deed preparation and recording related to transferring clear title, plus fees to release existing mortgages.
- Seller credits or concessions agreed in the contract, and prorated items like property taxes or HOA dues through the closing date.
Shared or negotiable
- Title exam and settlement fees. These may be split or assigned to one party by custom or contract.
- Title endorsements or extended coverage. Payment varies by negotiation.
- Escrow fees. These are sometimes split.
DC taxes that impact totals
Transfer tax basics
Transfer tax is imposed when real property changes hands in DC. It is a large, single line item that affects seller net proceeds, though buyers and sellers can negotiate who pays. Rates and exemptions can change. Review the current schedule on the DC Office of Tax and Revenue transfer tax page, and have your title company run an exact calculation for your address and contract terms.
Recordation tax basics
Recordation taxes and fees are charged when deeds and mortgages are recorded. In DC, mortgage recordation taxes are tied to the loan amount and are typically paid by the buyer when financing. Deed recordation is also part of settlement. Check the latest details on DC OTR’s deed and recordation tax guidance and confirm the specific calculation with your title company.
Estimating your numbers
A fast way to size your cash-to-close or net proceeds is to apply simple ranges, then replace them with precise numbers once your lender and title company quote your file.
- Buyer quick estimate. Down payment plus about 2% to 5% of the purchase price for closing costs if you are financing. If you are paying cash, your total is usually lower since you remove lender fees and mortgage recordation taxes, but you still include title charges and any transfer or recordation taxes that apply by contract.
- Seller quick estimate. Sale price minus commission and taxes, plus any negotiated credits. Total selling costs often land in the 6% to 10% range, with the commission making up the largest share in many cases.
Example to show scale
Consider a purchase price of 500,000 dollars.
- Buyer closing cost ballpark, excluding down payment, is 2% to 5% or about 10,000 to 25,000 dollars.
- Seller total selling costs, including an assumed 5.5% commission, might fall around 6% to 10% or about 30,000 to 50,000 dollars.
These are only illustrations. DC transfer and recordation taxes, title premiums, and lender fees depend on the exact property details, loan amount, and contract terms. Replace the example figures with your own Loan Estimate and a title company quote.
Three documents to gather early
- Loan Estimate from your lender. This shows expected lender fees, prepaid items, and your interest rate structure.
- Preliminary title estimate or settlement statement. Your DC title company will calculate transfer and recordation taxes, title insurance, and recording fees specific to your contract.
- Seller net sheet or estimate. If you are selling, ask your listing agent to prepare a net sheet that includes likely commission, DC taxes, payoff amounts, and prorations.
Timing and required disclosures
Federal law requires your lender to provide a Closing Disclosure at least three business days before closing so you can review your final figures. To understand what you will receive and when, see the CFPB explainer on the Closing Disclosure. Early in the process, your lender will also issue a Loan Estimate; the CFPB guide to the Loan Estimate explains what to look for.
Tips to reduce or plan for costs
- Compare lenders. Fees and rate options vary. A slightly lower rate with higher points might not be the best total-cost choice for your timeline.
- Ask about title premiums and endorsements. Title insurance rates follow set schedules. Your title company can quote alternatives and explain coverage options.
- Negotiate credits. Buyers sometimes receive a seller credit to offset closing costs, subject to loan program limits. Sellers may negotiate payment of transfer tax, owner’s title policy, or move-in fees as part of offer terms.
- Confirm exemptions or programs. DC has exemptions and relief programs that change over time. Verify current eligibility with the DC Office of Tax and Revenue and ask your title company to apply any that fit your situation.
- Time your closing date thoughtfully. Prorated taxes, HOA dues, and daily interest can shift based on your settlement date.
Action checklist
- Ask your lender for a Loan Estimate as soon as you apply. Compare at least two quotes.
- Request a preliminary settlement estimate from a DC title company so you see transfer and recordation taxes, title premiums, and recording fees for your contract.
- For sellers, request a payoff statement from your current lender to include accurate payoff amounts in your net sheet.
- Confirm who pays the owner’s title policy and any transfer or move-in fees in the contract. Get each item spelled out in writing.
- Review your Closing Disclosure line by line at least three business days before settlement. Ask the title company and your agent to walk you through any questions.
Work with a local pro
Closing costs in Washington, DC are manageable when you see the full picture early. You deserve clear numbers, smart negotiation, and a smooth closing timeline that fits your life. Our team provides concierge guidance, from precise title and tax estimates to offer strategies that align with your goals and the current market.
If you are planning a purchase or sale, connect with Fleur Howgill for tailored advice and a private estimate of your cash-to-close or net proceeds. Request a Confidential Home Valuation or a buyer cost breakdown today.
FAQs
Who pays DC transfer tax in a typical sale?
- In many DC transactions the seller pays transfer tax, but it is negotiable and set by the contract. Confirm current rates and any exemptions with your title company and the DC Office of Tax and Revenue.
How big are DC transfer and recordation taxes?
Do buyers pay for title insurance in DC?
- If you finance, the lender requires a lender’s title policy that buyers typically pay. The owner’s title policy is sometimes provided by the seller in DC, but it is negotiable. Your title company will itemize both.
Can I roll closing costs into my mortgage?
- Some lender fees can be financed if your lender allows, often by adjusting the loan amount or using lender credits. Many third-party fees and taxes must be paid at closing unless you negotiate a seller credit that your loan program permits.
When will I see final numbers before closing?
- Your lender must deliver a Closing Disclosure at least three business days before settlement. Review the CFPB Closing Disclosure guide to know what to expect.
What does a DC title company do?
- The title company searches title, issues title insurance, calculates transfer and recordation taxes, coordinates payoffs and prorations, and prepares your final settlement statement. They are your best source for precise, property-specific costs.
