Closing costs in Texas are the fees and prepaid items you pay to finish a home purchase, on top of your down payment. They fall into a few buckets: lender charges, third-party services like the appraisal and title insurance, government fees, and prepaids such as interest, homeowners insurance, and your first escrow deposit. Texas title insurance premiums are set by the Texas Department of Insurance, so every title company charges the same premium for the same policy. Your exact numbers show up on your Loan Estimate and again on your Closing Disclosure.
I'm Taylor Ring, a Mortgage Loan Officer with Fairway Independent Mortgage Corporation (The Wood Group) in Belton. You won't find a percentage rule of thumb here. Costs depend on your price, loan type, lender, title company, and closing date, and no official source publishes a reliable Texas average. What I can give you is how each piece works, which parts you can shop, and where the help comes from.
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The Main Categories of Closing Costs
The Consumer Financial Protection Bureau groups mortgage closing costs like this (CFPB):
| Category | What It Includes | Can You Shop It? |
|---|---|---|
| Origination and lender charges | Origination, application, underwriting, processing, or administrative fees | Compare lenders; the total matters more than the labels |
| Points | An optional upfront charge to lower your rate | Your choice |
| Third-party services | Appraisal, title insurance, and similar required services | Some can be shopped |
| Government fees | Fees charged by your local government for the transaction | Generally the same at every lender |
| Prepaids and escrow | Interest to the end of the month, first-year homeowners insurance, initial escrow deposits for taxes and insurance | Set by your closing date, insurance quote, and tax estimate |
| Optional purchase costs | Home inspection, owner's title policy, real estate agent fees | Varies |
Texas Title Insurance: Rates Set by the State
This is the part of Texas closing costs that surprises people most. According to the TDI title insurance FAQ:
- Premiums are regulated. Every title company charges the same premium for the same policy, and discounts aren't allowed.
- The premium covers the title search, the examination, and closing the transaction, and you pay it once, at closing.
- Texas doesn't require title insurance, but your lender will require a loan policy.
- Buy both and save on the loan policy. When you buy an owner's policy and a loan policy at the same time, the loan policy is issued for $100. Skip the owner's policy and you pay full price for the loan policy.
- Who pays the owner's policy is negotiable between buyer and seller.
2026 Basic Premium Examples
TDI's rates effective March 1, 2026 price a policy by its amount. For policies from $100,001 to $1,000,000, the basic premium is $780 plus 0.00494 times the amount over $100,000, rounded to the nearest dollar.
| Policy Amount | Basic Premium | Source |
|---|---|---|
| $100,000 | $780 | TDI rate table |
| $268,500 | $1,612 | TDI's own example |
| $300,000 | $1,768 | Calculated with TDI's formula |
| $400,000 | $2,262 | Calculated with TDI's formula |
Source: TDI Texas Title Insurance Basic Premium Rates, effective March 1, 2026. These are basic premiums only. Endorsements and other title charges are separate.
What You Can Shop
The premium is fixed, but escrow fees and other closing charges vary by title agent. TDI lists tax certificates, recording fees, and delivery expenses as common extra charges, and suggests asking for documentation of their true cost. You can also pick your own title company. TDI points out that RESPA Section 9 bars a seller from requiring you to use a specific one.
One more TDI note worth knowing: title insurance doesn't cover boundary disputes with a neighbor unless you buy additional coverage.
The Survey and the T-47 Affidavit
If the seller has an existing survey, Texas title companies can rely on it with a sworn Form T-47, Residential Real Property Affidavit, or the unsworn Form T-47.1 declaration. Both are promulgated by TDI and effective November 1, 2024 (TDI forms).
The forms are used when the owner or lender has asked for area and boundary coverage in the title policy. The person signing states that since the survey date there have been no:
- new structures, rooms, garages, pools, decks, or other permanent improvements
- changes to boundary fences or walls
- construction on adjoining property near the boundary
- conveyances, replats, or easement grants
Any exceptions get listed. The T-47 is signed before a notary; the T-47.1 is signed under penalty of perjury. The forms also say the title company may make exceptions to coverage as it deems appropriate. If you want that area and boundary coverage in your owner's policy, the forms note it's available "upon payment of the promulgated premium." Ask your title company for the amount.
Prepaids and Your First Escrow Deposit
Prepaids aren't fees. They're the start of costs you'd pay anyway as a homeowner. The CFPB lists:
- Interest from your closing date to the end of that month
- The first year's homeowners insurance premium
- Initial escrow deposits toward future property taxes and insurance
Property taxes drive a big part of your escrow. After you close, file your homestead exemption; my guide on how to file the homestead exemption in Texas walks through Form 50-114.
Who Pays What in Texas
The CFPB says the buyer generally pays the costs tied to the purchase, but the contract or state law may have the seller pay some of them (CFPB). VA lists items buyers and sellers can negotiate, such as real estate commissions, hazard insurance and real estate taxes, and state and local taxes. In practice, nearly everything is a negotiation in the contract.
Two cautions from the CFPB:
- A seller credit often comes with a higher price, so you may still pay for those costs through your loan.
- A lender credit usually means a higher loan amount or a higher interest rate.
Seller Credit Limits by Loan Type
| Loan Type | Official Rule |
|---|---|
| FHA | Interested parties, including sellers, builders, and agents, can contribute up to 6% of the sales price toward origination fees, other closing costs, prepaids, and discount points (HUD Handbook 4000.1) |
| VA | VA doesn't limit seller credits for closing costs, but seller concessions are capped at 4% of the home's reasonable value. On a VA purchase loan, only the funding fee can be financed (VA) |
| USDA | Loan funds can pay reasonable and customary closing costs, but costs a seller or third party pays can't be included in the guaranteed loan amount (7 CFR 3555.101) |
| Conventional | Limits come from Fannie Mae and Freddie Mac guidelines rather than the sources above. I'll confirm the limit for your file |
A buyer in Temple had savings and wanted to keep as much of it as possible. We compared low-down-payment options, assistance programs, and seller credits, looking at the payment, the rate, the cash to close, and any repayment terms side by side.
Illustrative scenario, not an actual client transaction. Seller credits are subject to negotiation and loan guidelines.
Using Down Payment Assistance for Closing Costs
Texas's two statewide housing agencies both allow their assistance to cover closing costs:
- TSAHC (Homes for Texas Heroes and Home Sweet Texas): up to 5% of the loan amount for the down payment, closing costs, and prepaids. Its guidelines say closing costs can include items such as real estate agent commission, following agency rules. See my Home Sweet Texas guide.
- TDHCA (My First Texas Home): down payment and closing cost assistance of up to 5% of the loan for first-time buyers using FHA, VA, or USDA. See my My First Texas Home guide.
Fairway is a participating lender for both TDHCA and TSAHC programs. For the broader picture, read Down Payment Assistance in Texas.
Your Loan Estimate and Closing Disclosure
Two federal forms keep these numbers in front of you:
- Loan Estimate: a three-page form your lender must give you within three business days of receiving your application. Every lender uses the same form, which makes offers easy to compare (CFPB).
- Closing Disclosure: a five-page form with your final terms and costs, which the lender must give you at least three business days before closing (CFPB).
When the Closing Disclosure arrives, put it next to your Loan Estimate and compare them line by line. Those three days are your time to ask questions.
Practical Ways to Lower Your Costs
- Compare Loan Estimates on total lender charges, not individual fee names.
- Ask title companies about escrow fees and extra charges. The premium won't change, but those can.
- Decide on points deliberately. They're optional.
- Negotiate seller credits within your loan type's limit.
- Check DPA eligibility before you write an offer.
- Pick your closing date with prepaid interest in mind, since you prepay interest from closing to month-end.
If you're using FHA, VA, or USDA, my FHA loans, VA loans, and USDA loans pages explain each program.
Frequently Asked Questions
What closing costs does a buyer pay in Texas?
Buyers typically pay lender charges, third-party services such as the appraisal and title insurance, government fees, and prepaids like interest, homeowners insurance, and initial escrow deposits. The purchase contract can shift some costs to the seller, and your Loan Estimate lists your expected costs.
Are title insurance rates the same at every Texas title company?
Yes. The Texas Department of Insurance sets title insurance premiums, so every title company charges the same premium for the same policy. Escrow fees and other closing charges can differ, so those are worth comparing.
Can the seller pay my closing costs in Texas?
Yes, if you negotiate it in the contract and stay within your loan type's limit. FHA allows interested party contributions up to 6% of the sales price, and VA caps seller concessions at 4% of reasonable value while not limiting credits for normal closing costs.
Can down payment assistance cover closing costs in Texas?
Yes. TSAHC assistance can pay the down payment, closing costs, and prepaids, and TDHCA's My First Texas Home provides down payment and closing cost assistance. Both programs have income, credit, and other requirements.
When will I see my final closing costs?
Your lender must give you a Closing Disclosure at least three business days before closing. It shows your final loan terms and costs, so compare it with the Loan Estimate you received within three business days of applying.
Let's Map Out Your Cash to Close
I'll build your numbers line by line, show where assistance or seller credits fit, and explain anything on the Loan Estimate that isn't clear.
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Related Guides
- Down Payment Assistance in Texas
- Home Sweet Texas Home Loan Program
- My First Texas Home Down Payment Assistance
- How to File the Homestead Exemption in Texas
- FHA Loans and VA Loans
Taylor Ring, NMLS #2809683 | Fairway Independent Mortgage Corporation, NMLS #2289 | The Wood Group of Fairway, 127 Lake Rd Ste 300, Belton, TX 76513 | Equal Housing Opportunity. This is not a commitment to lend. All loans are subject to credit approval and program guidelines, and approval, rates, and program availability are not guaranteed. Title premium examples are basic premiums from TDI's published rate table and do not include endorsements or other charges. Not affiliated with or endorsed by TDI, the CFPB, TDHCA, TSAHC, or any government agency.