Closing Costs in Florida: What Homebuyers Typically Pay

Closing costs are the fees and charges you pay to finalize a mortgage and transfer ownership, on top of your down payment. In Florida, some of these costs are set by state law, some depend on local custom and some vary by lender and property.

This guide covers the typical categories. Your Loan Estimate will list the exact figures for your loan, and your Closing Disclosure will confirm the final numbers before you sign.

Lender fees

These are charges for originating your loan. Depending on the lender, they may include:

• An origination or processing fee
• Underwriting fees
• Discount points, if you choose to pay them to lower your rate
• A credit report fee

Lender fees are one of the areas where comparing offers matters most. On the Loan Estimate, they appear in Section A, Origination Charges.

Appraisal, title and other third-party services

These are services the lender requires but that other companies provide.

Appraisal. An independent appraiser estimates the home’s market value. The cost depends on the property type and complexity.

Title search and title insurance. A title company or attorney reviews public records to confirm the seller can transfer clear ownership. The lender’s title policy protects the lender, and an owner’s policy protects you. In Florida, title insurance premiums are set by state regulation, although related charges such as settlement fees and endorsements can vary. Who pays for the owner’s policy depends on local custom and your contract. In Miami-Dade, the buyer commonly pays for it.

Other services. Depending on the property, you may also see charges for a survey, a flood zone determination, inspections or similar services.

Florida taxes on the mortgage

Florida charges two taxes when a new mortgage is recorded. Both are based on the loan amount, not the purchase price, and both are typically paid by the borrower.

Documentary stamp tax on the note: $0.35 per $100 of the loan amount. On a $400,000 loan, that works out to $1,400.

Intangible tax on the mortgage: 0.2% of the loan amount. On a $400,000 loan, that works out to $800.

Because these taxes are set by state law, they will be the same for a given loan amount no matter which lender you choose.

Documentary stamp tax on the deed

When ownership transfers, Florida also charges a documentary stamp tax on the deed, based on the sale price. In most of the state, the rate is $0.70 per $100. Miami-Dade County has a different structure: $0.60 per $100 for single-family residences, with an additional surtax on other property types.

By custom in most of Florida, the seller pays the deed tax, but the purchase contract ultimately decides. New construction contracts sometimes shift certain costs to the buyer, so read that section carefully.

Recording fees

The county charges fees to record the deed and the mortgage in the public records. These are generally modest and based on the number of pages recorded.

Prepaid items and escrow

Some of what you pay at closing is not a fee at all, but money paid in advance for costs you would owe anyway.

• Homeowners insurance. Lenders typically require the first year’s premium to be paid at or before closing. In South Florida, wind coverage is a significant part of the cost, and flood insurance may be required depending on the property’s flood zone.
• Prepaid interest. Interest that accrues from your closing date to the end of that month.
• Initial escrow deposit. If your loan has an escrow account, the lender collects an initial deposit so there is enough to pay property taxes and insurance when they come due.

Florida property taxes are paid in arrears, with bills issued in November for the current calendar year. At closing, the seller typically credits you for their share of the year’s taxes, and the escrow deposit builds the cushion needed for the next bill. The amount can differ depending on when in the year you close.

If you are buying a condo, you may also see association-related charges, such as estoppel certificate fees or capital contributions, depending on the building and your contract.

Who pays what

Florida purchase contracts spell out which party pays which costs. Local custom is a useful guide, but the contract controls. You may also be able to negotiate seller credits toward your closing costs, within the limits of your loan program.

How to estimate your total

Closing costs vary with the purchase price, loan amount, property type, insurance and closing date, so a single rule-of-thumb percentage can be misleading. A more reliable approach:

• Request a Loan Estimate as soon as you have a property address
• Compare Section A, Origination Charges, across offers
• Ask your loan officer which costs are fixed by law and which ones you can shop for
• Review your Closing Disclosure carefully; you should receive it at least three business days before closing

For monthly payment estimates that include taxes and insurance, try our mortgage calculator. You can also read about how we work to see how we build and compare your options, including closing costs.

Know your numbers before you make an offer

In a 30-minute goal consultation, we will walk through estimated closing costs for the price range you are considering and show you where there may be room to save. Request your consultation.