Answers
Cash to Close & Closing-Cost Questions
Exactly what you need to bring, and how to bring less.
The one number that surprises buyers at the end is the cash to close. Here is what goes into it and how to manage it.
Common questions
What is ‘cash to close’?
It is the total amount you bring to closing — your down payment plus closing costs and prepaid items, minus any deposits and credits already applied. Your Closing Disclosure states the exact figure, and you should know it well before closing day.
How can I reduce the cash I need at closing?
Seller concessions, lender credits, down-payment and closing-cost assistance programs, and on some refinances rolling costs into the loan can all lower your out-of-pocket. We will structure your loan to minimize the cash you need while keeping the overall cost sensible.
Can the seller pay my closing costs?
Often, within program limits. A seller concession is a common, negotiable term where the seller agrees to cover part of your closing costs — a powerful way to reduce the cash you need, especially in a buyer-friendly market.
What is a lender credit?
It is money the lender applies toward your closing costs in exchange for a slightly higher rate. It can be the right trade if you will move or refinance before the higher rate outweighs the savings — useful when conserving cash matters more than the lowest rate.
How do I pay my cash to close?
Typically by wire transfer or cashier’s check following the official instructions. Always verify wire details by calling a known, trusted number for your settlement agent — never a number from an email — to protect against wire fraud.
Are prepaid taxes and insurance part of closing costs?
They are collected at closing but are really your own taxes and insurance paid a little early, plus the initial escrow deposit. They make the closing figure look larger than the true cost of the loan, so it helps to separate them in your mind.