Wondering how much cash you’ll need at the closing table in Dallas? You’re not alone. Between lender fees, title costs, and Texas-specific items like option fees and HOA paperwork, it can feel confusing. In this guide, you’ll learn what typical closing costs look like for Dallas buyers, what is unique in Texas, and a simple way to estimate your own number. Let’s dive in.
Dallas closing costs at a glance
Most buyers can expect total closing costs to land around 2% to 5% of the purchase price. The exact figure depends on your loan type, lender, and timing. In Texas, higher property taxes and required escrow reserves can increase your upfront cash needs at closing.
To make the math concrete:
- $300,000 purchase: plan for roughly $6,000 to $15,000 in total closing costs.
- $500,000 purchase: plan for roughly $10,000 to $25,000.
These ranges include lender fees, title and settlement fees, prepaid items, and initial escrow reserves. Your actual number will vary by lender and property.
What buyers typically pay
Lender and loan fees
- Origination or lender fee, often 0.25% to 1.0% of the loan amount, or a flat fee.
- Discount points if you choose to buy down your rate. Each point equals 1% of the loan amount.
- Processing and underwriting, commonly $300 to $1,200 combined.
- Credit report, about $25 to $50.
- Appraisal, usually $400 to $800 for a single-family home in the Dallas area.
- Small lender-required services like flood certification or tax service, about $50 to $250.
- Prepaid interest from your closing date to the first payment due date.
Tip: You should receive a Loan Estimate within three business days of application. Use it to compare offers from at least two lenders.
Title and settlement fees
- Lender’s title insurance policy, usually required by the lender. Rates are set by the Texas Department of Insurance.
- Owner’s title policy, optional for buyers but common. The cost is a one-time premium based on the purchase price and is negotiable in who pays.
- Settlement or closing fee, typically $300 to $800.
- Document prep, notary, and courier, often $50 to $300.
- County recording fees for the deed and deed of trust, generally a few dozen to a few hundred dollars in Dallas County.
Texas premiums are regulated, so a title company can quote exact title insurance costs for your price point.
Prepaids and escrow reserves
- First year of homeowners insurance, often paid at closing.
- Property tax proration for the closing date plus an initial escrow cushion. In Dallas County, tax bills and entities vary by property, so this depends on the closing date and the home’s current year taxes.
- If your loan program includes an upfront insurance fee, such as FHA, that may be due at or before closing.
Because Texas property taxes are relatively high, lenders often collect several months of taxes and insurance to start your escrow account. This can make your upfront cash-to-close higher than in some other states.
Inspections and surveys
- General home inspection, usually $300 to $700 depending on size and scope.
- Pest or termite inspection, about $50 to $150.
- Survey, if needed, often $200 to $600.
These are often paid before closing and may not appear the same way on your Closing Disclosure, but they affect your overall out-of-pocket costs.
Texas-specific items
- Option fee for the option period, typically $100 to $500 in many Dallas transactions, paid to the seller for a short unrestricted option period. It is usually nonrefundable but credited to you at closing if the sale goes through.
- Earnest money deposit, commonly 1% to 3% of the purchase price, wired to escrow early in the process. It is not a fee, since it is applied to your purchase at closing.
- HOA resale and transfer fees, if the property is in an HOA. Some fees are paid by the seller per Texas Property Code, others by the buyer. It is negotiable and varies by HOA.
A cost you will not see
- No state or local real estate transfer tax in Texas. You should not expect a transfer tax line item at closing.
How to estimate your number
Follow these practical steps to build a working estimate for a Dallas purchase.
Step 1: Nail down price and loan
- Decide on your target price, down payment, and loan type such as conventional, FHA, VA, or USDA.
- Request Loan Estimates from at least two lenders. These will outline lender fees, prepaid interest, and initial escrow projections.
Step 2: Get title quotes
- Ask your title company for a sample Closing Disclosure based on the price and loan details.
- Request exact premiums for the lender’s and owner’s title policies. Texas title rates are standardized by the state.
Step 3: Estimate taxes and escrow
- Gather the property’s current year taxes from the Dallas Central Appraisal District or ask the listing agent for the latest bill.
- Estimate the seller-buyer tax proration for your closing date.
- Confirm how many months of tax and insurance reserves your lender will collect. Many lenders collect about two months for each, though practices vary.
Step 4: Add inspections and Texas items
- Include the home inspection, termite inspection, and appraisal.
- Set aside the option fee amount and confirm any HOA resale or transfer charges. Clarify who pays those in your contract.
Step 5: Total it up
Add the following:
- Lender fees from your Loan Estimate
- Title and settlement fees plus title premiums
- Prepaid insurance, prepaid interest, and tax proration
- Escrow reserves for taxes and insurance
- Inspections, appraisal, survey, and option fee
Express the total as both a dollar figure and a percent of the purchase price so you can compare homes across different price points.
Illustrative example
The following is an illustrative example to show how the math can come together. Your actual costs will differ.
- Purchase price: $400,000, 20% down, conventional loan
- Lender fees and appraisal: $2,500
- Title and recording: $1,200
- First year homeowners insurance: $1,200
- Prorated taxes plus initial escrow cushion: $2,000
- Inspections and survey: $900
- Option fee and earnest money: $300, treated separately or credited
- Estimated cash to close for costs: about $8,100, which is roughly 2% of the price
Smart ways to manage costs
- Compare at least two Loan Estimates so you can evaluate lender fees, rate, and prepaid figures side by side.
- Ask your lender how many months of tax and insurance reserves they plan to collect and whether timing your closing date could reduce prepaid interest.
- Discuss seller concessions with your agent. Sellers can contribute to buyer closing costs within loan program limits.
- Confirm HOA-related fees early so you know what the association will charge and who pays per your contract.
- Use the option period wisely to complete inspections quickly and make any repair or credit requests within the timeline.
What to bring to closing
Keep this quick checklist handy:
- Government-issued photo ID
- Proof of homeowners insurance and binder
- Certified funds or a verified wire for your cash to close
- Final walkthrough notes and any agreed repair receipts
- Contact information for your lender and title company
Wire safety reminder
Wire fraud is real. Before you send any funds, call your known title escrow officer at a verified phone number to confirm wiring instructions. Do not rely on unverified email or last-minute changes.
Work with a local guide
You deserve clarity and confidence from offer to closing. As a boutique, family-led team serving Park Cities, Preston Hollow, Lakewood, and the wider Dallas area, we guide you through each cost line, coordinate with your lender and title team, and help you plan your cash to close with no surprises. Ready to map out your numbers for the neighborhoods you love? Request a complimentary neighborhood consultation with The Blackman Group.
FAQs
How can I get a guaranteed number for Dallas closing costs?
- Use your lender’s Loan Estimate and ask your title company for an itemized quote. Your final numbers appear on the Closing Disclosure at least three days before closing.
Who pays for title insurance in a Texas home purchase?
- The lender’s title policy is usually paid by the buyer. The owner’s policy is a one-time premium based on price and is commonly negotiated between buyer and seller.
Is the Texas option fee required when buying a home?
- No. It applies only if you choose an option period. Many buyers use it to secure time for inspections, and it is typically credited back at closing if you proceed.
Can a seller pay my closing costs in Dallas?
- Yes, seller concessions are allowed within loan program limits and are negotiated in your contract.
Do Dallas buyers pay transfer taxes at closing?
- No. Texas does not charge a state or local real estate transfer tax, so you will not see that line item.
How do I avoid wire fraud during my Dallas home purchase?
- Call your known title escrow officer at a verified number to confirm wire instructions and never act on unverified email directions.
