Closing costs for cash home buyers typically run about 1% to 3% of the purchase price. Paying cash eliminates loan origination fees, private mortgage insurance, and lender-required appraisals, but title insurance, escrow or attorney charges, recording fees, transfer taxes, and prorated property taxes still land on the settlement statement. A handful of costs are optional, and skipping them is where cash buyers get into trouble.
Title Search and Owner’s Title Insurance
A title search confirms the seller actually owns the property and can legally transfer it, and it uncovers liens, judgments, easements, and other encumbrances tied to the property. The search itself costs $150 to $400.
Without a lender in the deal, no one requires a lender’s title policy. An owner’s title policy is a separate one-time premium, and it’s the coverage that protects you personally if a previously unknown heir shows up claiming ownership or an old contractor’s lien surfaces after closing. Owner’s title insurance typically costs 0.5% to 1.0% of the purchase price. On a $400,000 home, that’s roughly $2,000 to $4,000. Endorsements for specific risks like mineral rights or zoning violations usually add $50 to $150 each.
Escrow, Attorney, and Settlement Fees
Escrow services hold funds and documents until both sides meet their obligations. The buyer’s share of escrow fees generally falls between 1% and 2% of the purchase price, though it varies by region and is often negotiable. In some markets the fee splits evenly with the seller; in others local custom assigns it to one side.
About half of U.S. states require or strongly encourage an attorney to handle the closing. Even where it’s optional, hiring a real estate attorney to review the purchase contract and manage the closing typically costs $500 to $1,500 for a straightforward residential deal. Complex transactions and higher-value properties run more. If you’re buying without an agent, that contract review matters more, not less.
Notary fees for witnessing signatures on the deed and closing documents run $50 to $200 in total, though some escrow companies and attorneys fold notary work into their overall charge. Wire transfer fees for moving funds to the settlement agent generally cost $25 to $50 per transfer.
Recording Fees and Transfer Taxes
Recording fees go to the county recorder’s office to document the new deed in public records. These commonly fall between $50 and $250 depending on the document length and local fee schedule. If recording doesn’t happen or gets filed incorrectly, your ownership may not appear in the public chain of title, which creates real problems when you later sell or refinance.
Transfer taxes catch a lot of first-time cash buyers off guard. Most states impose a tax when real property changes hands, calculated as a percentage of the sale price. Rates range from as low as 0.01% to over 2% depending on the state and sometimes the county or city. Fourteen states impose no transfer tax at all. Who pays — buyer, seller, or both — depends on local law and negotiation. In a state with a 1% transfer tax, a $400,000 purchase carries a $4,000 tax bill.
Prorated Property Taxes and HOA Fees
Property taxes get divided between buyer and seller based on the closing date. If the seller already paid the annual bill, you reimburse them for the portion of the year you’ll own the home. If they haven’t paid yet, you get a credit. The dollar amount swings significantly based on local tax rates and how close you close to the next tax due date.
If the home sits inside a homeowners association, expect a one-time transfer fee or capital contribution, commonly $200 to $1,000. The fee covers updating association records and providing governing documents such as CC&Rs and financial statements. It’s set by the association’s bylaws and is separate from the regular dues that start after you take ownership.
Home Inspection Fees
A general home inspection is the first meaningful cost, and it’s paid directly to the inspector before closing rather than at the settlement table. The national average is about $343 for a standard-sized home, with most buyers paying $300 to $500 depending on square footage and location. Homes over 2,500 square feet routinely push past $400, and high-cost metros run higher.
Specialized testing adds up. Radon typically costs $150 to $250, mold assessments often exceed $300, and a sewer scope for older homes runs roughly $200 to $400. Termite and wood-destroying organism inspections generally cost $75 to $150. Skipping a general inspection because no lender is requiring one is the most expensive mistake cash buyers make.
Should You Pay for an Appraisal and Survey?
Without a lender, no one is independently confirming that the price reflects the property’s actual market value. Ordering your own appraisal costs $350 to $600 for a traditional in-person assessment of a standard home, more if the property is unusually large, remote, or has unique features. For that money you get a professional opinion on whether you’re overpaying by tens of thousands.
A boundary survey marks the exact legal edges of the lot. It matters more than most buyers realize for properties with fences, shared driveways, or structures near a property line. A standard residential boundary survey costs $300 to $900 for a lot up to half an acre. A neighbor’s garage encroaching two feet onto your land is far cheaper to identify before closing than after.
Homeowner’s Insurance
Homeowner’s insurance isn’t a closing fee, but it belongs in your closing budget. No lender will require coverage on a cash purchase, and going without it means a single fire, storm, or liability claim can wipe out the investment. The average annual premium is about $2,490 for a policy with $400,000 in dwelling coverage, with actual cost driven by location, age of the home, construction type, and coverage limits. Most cash buyers arrange coverage to start on the closing date so there’s no gap in protection.
Federal Reporting for Large Cash and Entity Purchases
Large cash transactions attract federal scrutiny, and the closing agent has legal obligations tied to your purchase. Any business that receives more than $10,000 in cash in a single transaction must file IRS Form 8300 within 15 days. For this purpose, “cash” includes currency and also cashier’s checks, money orders, and traveler’s checks with a face value of $10,000 or less when combined with other cash to exceed the threshold.1Internal Revenue Service. Understand How to Report Large Cash Transactions A single cashier’s check over $10,000 used to pay for the property does not by itself trigger Form 8300. Breaking payments into smaller pieces to stay under the threshold is a federal crime.
If you’re purchasing through an LLC, corporation, trust, or other legal entity rather than in your personal name, additional rules apply. A FinCEN final rule that took effect in December 2025 requires reporting on all non-financed residential real estate transfers to legal entities and trusts, regardless of purchase price.2FinCEN. RRE Fact Sheet Separately, FinCEN’s Geographic Targeting Orders impose reporting requirements in dozens of metro areas when an entity purchases residential property above specified thresholds, starting as low as $50,000 in some jurisdictions and $300,000 in many major markets.3FinCEN. Geographic Targeting Order Covering Title Insurance Company The title company files the report, but you’ll need to disclose beneficial ownership information for anyone holding 25% or more of the purchasing entity.